Agricultural Law and Rural Practice Blog: Emerging Markets in Rural Industry: Wisconsin’s Industrial Hemp Pilot Program :

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  • Agricultural Law and Rural Practice Blog
    October
    29
    2018

    Emerging Markets in Rural Industry: Wisconsin’s Industrial Hemp Pilot Program

    Cathleen A. Dettmann

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    Wisconsin’s Department of Agriculture, Trade, and Consumer Protection is wrapping up the first year of its pilot research program into hemp cultivation and hemp product manufacturing. Cathleen Dettman discusses the program, and suggests that interested Wisconsin farmers should beware of the program’s many rules and limitations.

    Wisconsin was once one of the largest producers of hemp in the United States, although that activity ceased when THC-containing plants like hemp and marijuana were defined as illegal narcotics in the 1970s.

    However, industrial hemp products are gaining ground once more, thanks to the 2014 Farm Bill, which distinguished marijuana from hemp, and permitted states to establish pilot programs for hemp’s growth and regulation.

    Falling or stagnant commodity prices have fueled interest generally in the industrial hemp market. Wisconsin farmers are no exception, showing considerable interest in participating in Wisconsin’s own pilot program established by the Department of Agriculture, Trade, and Consumer Protection (DATCP), which allows for the growing and processing of industrial hemp under a strict set of rules.

    Exemptions and the 0.3 Percent Limit

    In May 2018, the Wisconsin Department of Justice (DOJ) provided additional reassurance to Wisconsin growers when it issued a press release that CBD oil (and other products) made from industrial hemp grown pursuant to DATCP’s pilot program are exempt from criminal prosecution.

    Cathleen A. Dettmann com dettmann hplawoffice Cathleen A. Dettmann, U.W. 2009, is a shareholder with Haley Palmersheim, S.C., Middleton, where she practices in the areas of business law and business litigation, including work with family farms and succession planning.

    However, the DOJ was also careful to state that only activities conducted in strict accordance with DATCP’s pilot program would be protected. Any unlicensed “rogue” activities involving hemp cultivation and the selling of hemp-based products are still subject to prosecution.

    Wisconsin’s program differentiates hemp from marijuana by its THC content. It requires that THC levels be less than 0.3 percent in order to be “fit for commerce.”

    Thus, many of the regulations associated with the pilot program are based around ensuring that the crop does not exceed the THC limit.

    Wisconsin’s Pilot Program

    To participate in the program, farmers and processors must apply for a license issued by DATCP, and must register annually during each growing season. For the 2019 growing season, applications are accepted between Nov. 1 and Dec. 31, 2018.

    DATCP provides a specific list of acceptable seed varieties, including certain varieties that are certified, meaning that the seeds are more likely to produce a crop that meets the THC level requirement. According to DATCP, if the farmer plants the crop using certified seed, then the grower cannot be prosecuted if the crop exceeds the 0.3 percent THC limit, so long as the THC amount is lower than 1.0 percent overall.

    Seed sourcing is done at the grower’s risk – DATCP itself is not yet registered as a seed importer (although its application is currently pending with the Federal Drug Enforcement Administration), and the interstate movement of hemp seed could potentially subject the grower criminal prosecution.

    Maintaining Compliance

    During the growing season, the licensed growers must provide specific reports to DATCP to maintain compliance with the program rules. These include a planting report by July 1 or 30 days after planting (whichever is earlier), and a final production report by Dec. 15 of the crop year.

    Licensed growers must also maintain a number of records and data for DATCP’s inspection.

    At least 30 days before harvest is set to begin, growers are required to notify DATCP so that inspectors can collect samples for THC testing. Samples are taken from each field and each variety planted, and are processed at the DATCP laboratory. Each sample and test is $250.

    If the samples pass the THC test (that the levels are 0.3 percent or lower), then DATCP will issue a “fit for commerce” certificate. If the crop sample tests above the acceptable level, then the entire field must be destroyed.

    DATCP’s webpage includes an overview of all of these rules, as well as other key information including seed sourcing guides, pesticide rules and allowances, and a growing guide issued by the UW-Extension.

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    Agriculture Law & Rural Practice Blog is published by the Solo/Small Firm & General Practice Section and the State Bar of Wisconsin; blog posts are written by section members. To contribute to this blog, contact com nancy ntruelaw Nancy Trueblood and review Author Submission Guidelines. Learn more about the Solo/Small Firm & General Practice Section or become a member.

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