What was the Agricultural Marketing Act of 1946? How Did It Affect Hemp Cultivation?

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The Agricultural Marketing Act of 1946 authorized and directed the then Secretary of Agriculture to roll out several programs that were key to improving the food industry in the country. This included a well-laid-out plan to inspect and grade raw and processed food, conduct intensive agricultural research, and provide education and marketing assistance to farmers.

The Act also sought to help farmers sell and store their farm surpluses, provide price stability for different crops, and even make it easier for farmers to find financial help. This paved the way for a range of price support subsidy programs over the next decades.

But how did this Act affect the hemp industry? Read on.

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What was the Agricultural Marketing Act of 1946? How Did It Affect Hemp Cultivation?

What Did the Agricultural Marketing Act Say About Hemp?

According to the Agricultural Marketing Act of 1946, hemp is defined as a growing or grown Cannabis sativa L. plant or any part of the plant including the seeds and all its extracts, derivatives, isomers, cannabinoids, salts, and acids – with a THC concentration of 0.3% or less by dry weight. This meant that you were legally allowed to cultivate and use hemp as long as it contained the stipulated THC levels. The Act also outlined how individual states and tribunals would pass and define their hemp laws.

This Act was passed amidst the U.S. Army’s “Hemp for Victory” campaign during World War II. This campaign aimed to revive hemp production in the country to boost the struggling economy. It eventually led to more than 400,000 acres of hemp production in the country. Unfortunately, this resurgence of the hemp industry was short-lived, and the restrictions were more limiting especially after the war.

Even with the Act allowing hemp cultivation and use, the industry still faced a lot of backlashes and scrutiny. For instance, the Marihuana Tax Act of 1937 was still in effect. Since there was no clear definition between cannabis and hemp, all hemp farmers had to register and pay the “Marihuana Tax” to grow and sell hemp and hemp products. This meant that farmers had to acquire tax stamps for hemp cultivation, pharmacists would need to pay a tax for selling medical hemp products, and physicians would also be taxed for prescribing hemp.

As a result, farmers slowly abandoned the crop for other cash crops and many pharmacists avoided dispensing medical hemp to dodge the hefty occupational fines. Eventually, the last industrial hemp fields were planted in 1957 in Wisconsin.

It even got worse after this. In 1970, President Nixon signed the Controlled Substance Act into law. This categorized all types of cannabis as Schedule 1 controlled substances alongside other hard drugs like LSD and heroin. According to this law, the definition of cannabis was comprehensive and didn’t distinguish hemp from the high-THC cannabis varieties. At this time, hemp cultivation was at an all-time low due to the constant frustrations from the government.

Hemp contains trace amounts of THC (the cannabidiol that makes you high), meaning it doesn’t have any psychoactive effects. On the contrary, it’s rich in CBD – a compound that has proven to have numerous health and therapeutic benefits and counters the psychoactive effects of THC.

Simply put, the Controlled Substance Act banned the cultivation, possession, and use of hemp in America. The law was maintained even after it sparked outrage from hemp farmers and supporters all over the country.

How the 2018 Farm Bill Amended the Agricultural Marketing Act of 1946

In 2014, President Barack Obama signed the 2014 Farm Act allowing hemp to be grown for research purposes only. And in 2018, the Senate passed the 2018 Hemp Farm Bill, removing hemp and its derivatives from the Controlled Substance list. This means that the cultivation and use hemp and hemp-derived products were legal in the U.S.

The 2018 Farm Bill amended the Agricultural Marketing Act in several ways. First off, it categorized hemp as an agricultural commodity under the U.S. Department of Agriculture. This made it eligible for federal programs like research grants, crop insurance, certifications for organic practices, and more.

The Farm Bill also allowed individual states to create requirements for their hemp “plans”. This included:

  • Information about the farmland on which hemp will be grown
  • Certification that the state has enough resources to effectively implement necessary hemp production processes 
  • Procedure for testing the THC concentration on hemp
  • Procedure for disposing of hemp and hemp products with exceeded THC levels
  • Procedure for submitting hemp cultivation and production information to the relevant bodies like the USDA
  • Procedure for conducting inspections of hemp farms
  • Procedure to comply with the enforcement regulations provided by the Act

Additionally, hemp-derived CBD (one of the biggest potential markets for hemp products) won’t violate the Controlled Substance Act. CBD is generally marketed as a relief product for various conditions like epilepsy, nausea, pain, post-traumatic stress disorder, and other disorders. Nonetheless, synthetic CBD and that derived from high-THC cannabis will still fall under the purview of the Controlled Substance Act.

Currently, the U.S. Food and Drug Administration (FDA) has only approved a handful of CBD products – some of which are used in the treatment of various types of epilepsy. It still holds that CBD shouldn’t be added in foods or dietary supplements under the Federal Food, Drug, and Cosmetic Act. But this is likely to change soon, especially with the growing research on hemp CBD properties.

The Future of Hemp in America

As an agricultural commodity, hemp could be an exciting game changer in the sector. Its cultivation comes with both environmental and cost-friendly benefits to the stakeholders. However, even though the hemp market is already poised to pick up quickly and become massive, we shouldn’t ignore the many challenges the industry is facing.

For instance, hemp is still pretty new in the market and this comes with supply chain problems, branding issues, and slow development of the end markets. Additionally, many farmers and consumers still need sufficient education about the benefits and proper use of hemp and its products. The hemp industry still has a long way to go – but it’s hopeful.

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For more interesting blogs about hemp and its products, browse our updated hemp blog.