The 2018 Farm Bill reclassified hemp, and it is now legal to grow industrial hemp. USDA’s Agricultural Marketing Service announced a rule that outlines how states and tribes can submit plans that will enable producers to grow hemp in those areas.
This rule is a first step that enables USDA agencies that administer farm programs — including the Farm Service Agency (FSA), Natural Resources Conservation Service (NRCS), and Risk Management Agency (RMA) — to provide guidance on eligibility for additional farm programs.
Eligible producers include those growing in accordance with USDA, state, and tribal plans or for research purposes under Section 7606. Learn more about USDA, state, and tribal plans by visiting AMS’ Hemp Production webpage.
Options for Hemp Growers
Crop Insurance and Safety Net
In crop year 2020, RMA's Whole-Farm Revenue Protection coverage and FSA's Noninsured Crop Disaster Assistance Program will provide coverage options to eligible producers. Additionally, RMA is working on additional insurance options for producers.
Reporting Hemp Acres
Licensed hemp producers are required to report planted acreage along with their license number to their local FSA office. Producers may also be eligible for FSA programs; some additional requirements may be required.
In crop year 2020, hemp producers may be eligible for FSA farm loans, such as operating, ownership, beginning farmer, and farm storage facility loans. More information will be available soon.
In 2020, eligible hemp producers will be eligible for multiple NRCS conservation programs, including the Environmental Quality Incentives Program, Conservation Stewardship Program, Agricultural Conservation Easement Program, and Regional Conservation Partnership Program.
Whole-Farm Revenue Protection
The Whole-Farm Revenue Protection, or WFRP, is available beginning the 2020 crop for hemp grown for fiber, flower, or seeds. WFRP allows coverage of all revenue for commodities produced on a farm up to a total insured revenue of $8.5 million.
Producers can now purchase WFRP coverage if they have a contract for the purchase of the insured industrial hemp and meet all applicable state, tribal, and federal regulations. WFRP provisions state that hemp having THC above the 0.3 compliance level will not constitute an insurable cause of loss. Additionally, hemp will not qualify for replant payments under WFRP.
RMA is currently looking at additional insurance options for hemp producers.
Hemp producers are required to file acreage reports with FSA, which includes these steps:
- Obtain a hemp production license or authorization number issued by USDA, state, or tribe.
- File an acreage report with FSA, including the license or authorization number and identifying each field or subfield where hemp is planted. These fields could be referred to as a “lot” and includes greenhouses.
- Identify the intended use of the reported hemp acreage:
- Fiber – used for cloth, pressed plastics, ropes, animal bedding, paper, biofuel, packaging, concrete additives, spill cleanup.
- Processing – grown for extraction of plant resin (which includes cannabidiol (CBD) and other phytocannabinoids). Resin is used in oils, lotions, cleansers, bath or other pharmaceutical or topical products.
- Grain – used for hemp hearts, crushed seed oil (not CBD), protein supplements (human or animal consumption)
- Seed – used for propagation stock, hybrids (non-human consumption)
Producers should contact their local FSA county office for more details on acreage reporting.
NRCS Conservation Programs
These NRCS conservation programs will be available for 2020 for producers meeting requirements: the Environmental Quality Incentives Program, Conservation Stewardship Program, Regional Conservation Partnership Program, and Agricultural Conservation Easement Program.
Hemp producers growing in accordance with Section 7606 will not need to modify their conservation program contract for their continued participation.
Hemp Pilot Farms
Before the 2018 Farm Bill, producers could only grow hemp if they met the university research pilot requirements of Section 7606 of the 2014 Farm Bill. Now, producers can grow hemp if they meet those requirements or they are growing in accordance with an approved hemp plan.
October 29, 2019 USDA Press Release: USDA Establishes Domestic Hemp Production Program
USDA is working to make available program options for hemp producers. More information will be posted on this webpage and shared with producers when available.