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Montana-Canada hemp trade gains interest, but hurdles remain despite legalization

Posted at 9:36 PM, Apr 09, 2019
and last updated 2019-04-09 23:36:55-04
Montana Industiral Hemp
The USDA must approve state plans for production and cultivation but those federal guidelines closely match Montana’s pilot program. (MTN News photo)

-Martin Kidston reporting for the Missoula Current

A question posed by a Missoula agricultural producer on regulations surrounding the trade of hemp prompted an offer by a member of the Canadian consul general’s office to help establish cross-border partnerships in the industry.

Jerome Pischella, the senior trade commissioner with the Consulate General of Canada, based in Denver, said Montana’s northern neighbor has always taken a progressive view on hemp and is already pursuing the industry.

“We legalized cannabis over two months ago now, but we haven’t yet improved or modernized our law as far as hemp is concerned,” Pischella said Tuesday during a trade forum hosted by the Montana World Trade Center.  “We’re in the process of doing so. We’ll have a hemp bill in May or June.”

Congress legalized hemp in the 2018 Farm Bill, marking a shift in U.S. policy on the crop. But Pischella said correcting some cross-border challenges remain, though resolving them could open the door to future trade.

In Kentucky alone, hemp processors earned nearly $58 million last year, up from less than $17 million the year before, according to one industry publication.

“There have been very large investments mostly in Saskatchewan and Alberta around hemp, around processing, around modifying applications,” said Pischella. “If you want to look at business or partner opportunities with your neighbors to the north, I would like to help you.”

On Tuesday, U.S. Senate leaders vowed to fix glitches in the measure passed in last year’s Farm Bill, as legal hemp shipments are still being intercepted by law enforcement officers who can’t distinguish between the legal and illegal crop.

Hemp is now listed on the Montana Department of Agriculture’s web page as a legal crop, noting that “industrial hemp is authorized as an alternative agricultural crop by the Montana Legislature.”

Ben Thomas, director of the Montana Department of Agriculture, said Canadian companies have already made major investments in Montana and other states, and most of Montana’s production of CBD is for the Canadian market.

CBD is extracted from hemp and used for a variety of medications, from anxiety to pain relief.

“There’s more certainty regarding the legality of that product in Canada rather than the U.S.,” said Thomas. “The biggest single improvement we could get in the U.S.-Canada relationship would be on how to get the hemp seed from Canada across the border into the U.S.”

Thomas said that could take time, even though hemp is no longer a controlled substance.

“The law is very clear on that, so there should be no import restrictions,” said Thomas. “But because it’s such a new law, it’s taking both our countries just a little time to figure out how this new environment of deregulation of cannabis works, because at the end of the day, it’s still cannabis.”

Sander Lurie, a public policy principal with Denton’s Law Firm in Washington, D.C., agreed. The industry is still young in the U.S., and trade will take time to establish.

“We have a complicated system here in the U.S. with hemp, cannabis, in that it’s technically – in parts of the federal drug law – illegal, even though states like Colorado have gone forward with legalization,” he said.

“As far as I know right now, people are just testing the waters in terms of making big investments in this product as a new substitute for existing products,” Lurie added. “They’re still trying to figure out the cost-benefit analysis of growing it.”