Hemp farmers plead for COVID-19 financial relief

Published Apr 29, 2020 12:00 p.m. ET
iStock / grejak

Legality may not be the answer to the hemp farmers' plight as the COVID-19 virus consumes us. The 2018 Farm Bill was introduced and signed into law by President Trump legalizing hemp. Currently, there is no clear insight into which of the (SBA) agencies hemp businesses may qualify for the program. There is a general feeling of being excluded from participating in the Economic Injury Disaster Loan Program, and this is the feeling of all farmers in general right now.

American hemp farmers

Cannabis news has indicated that hemp farmers could be eligible for the assistance outlined in the relief plan budget in the United States. Hemp Inc is thankful for the favourable decision to allocate stimulus funds to the small business and farmers. Bruce Perlowin, the CEO of the company, emphasizes that the hemp farmer is an intricate part of the American agricultural and hemp supply chain.

Hemp is an agricultural commodity, unlike cannabis, a controlled substance. The hemp farmer would be eligible for the benefit of the stimulus. The hemp industry needs support; the farmer is pleading for relief. Engaging in the support efforts for the hemp industry now will be uplifting as the dust settles post-COVID 19. Hemp is legal and heavily regulated. The hemp flower as is the whole plant is protected, and this business is entitled to the relief from the stimulus just like any other industry today.

Canadian hemp farmers

1938 hemp production was prohibited under the Opium and Narcotic Drug Act, and it took until 1961 for Health Canada to allow limited production of hemp for scientific research purposes.1968 saw industrial hemp legalized in Canada

Last year saw the legalization of the hemp flower portion of the plant. The cannabidiol (CBD) is extracted from the hemp flower. CBD is known for being an anti-inflammatory and anti-anxiety agent and an overall pain reliever. There is no psychoactive ability in this cannabinoid. It will not deliver a high experience when ingested. Until last year the extraction of CBD from the hemp flower was illegal. Processing or selling CBD to a consumer was also unlawful until this time.

The Cannabis Act made it legal for hemp farmers to sell CBD abundant biomass to licensed processors. The hemp farmer began adding to the CBD inventory of Canada. Previously CBD was supplied by medical cannabis farmers only. The Canadian government has put forth the effort to assist the cannabis businesses by helping them to keep employees on the payroll during this COVID-19 virus.

Firms of all sizes will be eligible for the three-month emergency wage subsidy program. The government heard the pleas of the hemp farmer. The FCC or Farm Credit Canada has approved cannabis businesses that have been negatively affected by the COVID-19 pandemic, to apply for a short-term government-backed loan and credit deferrals. This could, for some cannabis businesses, be a necessary lifeline.

The federal government is offering a five billion Canadian dollar pool of emergency money.  If the theory of the plan works out, this program could be the necessary help for the cannabis producer or business owner who would be facing a financial crash during this pandemic.

Could 2020 prove to be a big year for hemp stocks

Hemp stocks are poised to show a more significant movement forward.  Federally marijuana is not legal in the U.S., but the market is ready for CBD, which is derived from the hemp plant as per the Farm Bill from 2018. A couple of Canadian hemp stocks are ready to surge forward in the hemp stock space.

Canopy Growth is licensed to grow 308,000 square feet of hemp in Kirkwood, New York. Canopy Growth launched First & Free, a new product line for hemp-based CBD products. U.S. Canopy Growth can ship the product across the border from Canada to the U.S. The partnering with Martha Stewart may also positively influence this hemp stocks climbing up the green wall.

Tilray is also looking to increase the hemp stock from this company. Part of the companies arsenal involves cash and lots of it totaling $322.7 million U.S. dollars. Tilray is a large and significant hemp producer. The company sees the forward movement to be profitable for Tilray. The company generates hemp-based CBD products that are currently sold in Canada and the U.S.

With both of these companies having their sight set on hemp-based products, there could be a dent in the U.S. market. Hemp stocks are on the move.

In conclusion

Hemp CBD products are sold globally in over 20 countries. U.S. and Canadian retailers of hemp CBD products are in the 16,000 range. The interest is there, the product is ready, and companies are hoping the hemp stocks will be a positive move upward. Cannabis news tells us the arrival of the COVID-19 virus has changed the immediate future for all cannabis and hemp businesses. However, moving forward, it seems the grass may be greener on the other side of this harmful virus, both for humans and companies.

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