Hemp Production — USDA Licensing & Regulation

The 2018 Farm Bill transformed hemp from a Schedule I controlled substance into a legal agricultural commodity regulated by the U.S. Department of Agriculture. 7 U.S.C. §§ 1639o–1639s — the hemp production subchapter — created the framework: hemp is Cannabis sativa L. with no more than 0.3% delta-9 THC by dry weight, and growing it requires either a state or tribal plan approved by USDA or a USDA-issued license if your state hasn't set up its own program.

The distinction from marijuana is entirely chemical and regulatory. Plants exceeding the 0.3% THC threshold are still treated as marijuana under the Controlled Substances Act, which is why testing and record-keeping are central to the federal hemp licensing system. USDA coordinates with the Attorney General on all rulemaking, and producers with prior drug felonies are locked out of the program for a decade.

Current Law (2026)

Legal Authority

• 7 U.S.C. § 1639o — Definitions (hemp = Cannabis sativa L. ≤ 0.3% delta-9 THC; covers all plant parts, extracts, cannabinoids, derivatives)
• 7 U.S.C. § 1639p — State and tribal plans (requirements for approval; Secretary has 60 days to approve/disapprove; audit rights; corrective action; enforcement graduated from negligence to criminal referral)
• 7 U.S.C. § 1639q — USDA federal plan (applies in states/tribes without approved plans; Secretary issues licenses; unlicensed hemp production unlawful; real-time law enforcement data sharing)
• 7 U.S.C. § 1639r — Regulations and guidelines; effect on other law (USDA has sole authority over hemp production regulations; annual report to Congress; does not affect FDA authority under FDCA or HHS authority under § 262 of title 42)
• 7 U.S.C. § 1639s — Authorization of appropriations (such sums as necessary)

Implementing Regulations

The AMS regulations implementing the hemp production program live at 7 CFR Part 990 — Domestic Hemp Production Program (29 sections across 6 subparts):

• § 990.1 — Definitions: "hemp" = Cannabis sativa L. ≤ 0.3% delta-9 THC on a dry weight basis; acceptable hemp THC level means the lab reports total delta-9 THC plus measurement of uncertainty (MU) — if the upper bound of the MU range still falls at or below 0.3%, the crop is acceptable; total THC is calculated as delta-9 THC + (0.877 × THCA) using gas or liquid chromatography; measurement of uncertainty is the critical concept — labs cannot simply report a single number, they must quantify uncertainty in their measurement
• § 990.2 / § 990.3 — State and Tribal plans: states/tribes that want to be the primary regulator submit a plan through the state department of agriculture (after consultation with the Governor and chief law enforcement officer); plans must address land record-keeping with geospatial data, THC testing protocols, disposal procedures, annual random inspections, and USDA information sharing; USDA has 60 days to approve or deny
• § 990.4 — USDA plan approval: if USDA denies a state/tribal plan, the state/tribe may revise and resubmit; USDA must explain denials in writing; once approved, plans remain in effect unless USDA finds material noncompliance
• § 990.5 — Audit of state/tribal compliance: USDA may audit states/tribes on their approved plans no more often than every 3 years under normal circumstances; audits may be on-site or desk audits; persistent compliance failures can accelerate the audit cycle

Subpart C — USDA Hemp Production Plan (13 sections — federal fallback for states without approved plans):

• § 990.20 — USDA rules apply in any state or tribal territory without an approved plan; persons with a state or federal controlled substance felony within the past 10 years are ineligible — with a narrow exception for producers already lawfully in the 2014 Farm Bill pilot before December 20, 2018
• § 990.21 — USDA hemp producer license: required before growing; application includes contact details plus a criminal history report from the FBI dated within 60 days; licenses are valid through December 31 of the year three years after issuance; must notify USDA of any material changes (ownership, location, key participants); research institutions may retain hot hemp above 0.3% THC only if DEA-registered to handle marijuana
• § 990.23 — FSA acreage report: licensees must report hemp crop acreage to FSA within 30 days after planting, with GPS or map coordinates for each lot, greenhouse, or site; FSA coordinates with AMS to share data with law enforcement in real time
• § 990.24 — Pre-harvest sampling: a USDA sampling agent must collect samples no more than 30 days before the expected harvest date by cutting the top 5–8 inches of the flowering top; this sampling method must produce 95% statistical confidence that the crop stays below the acceptable THC level; mixing lots or materials after sampling is prohibited
• § 990.25 — Lab standards: labs must use validated methods with quality controls, prove they can detect THC at the needed sensitivity, and report both the delta-9 THC result and the measurement of uncertainty; USDA accepts only DEA-registered labs
• § 990.26 — Post-testing obligations: producer must harvest within 30 days of sampling; if not harvested within 30 days, a second pre-harvest sample is required; compliant lots may proceed; non-compliant lots cannot be harvested without remediation approval
• § 990.27 — Non-compliant plants: plants above the THC threshold are treated as marijuana under the CSA; producer must arrange disposal via a DEA-registered reverse distributor or on-farm destruction (plowing, composting, burning, burying); DEA-registered research institutions may retain hot hemp until the research ends
• § 990.29 — Violations: negligent violations (wrong land description, unlicensed production, exceeding 0.3% THC by mistake) carry a corrective action plan and 2-year compliance reporting — no criminal penalties for negligent violations; three negligent violations within 5 years → 5-year ban; violations worse than negligence must be immediately reported to the U.S. Attorney General and local law enforcement, triggering full criminal enforcement
• § 990.32 — Recordkeeping: USDA licensees must retain records documenting all hemp acquired, grown, stored, sold, disposed of, or remediated; records must be available for USDA audits covering the current and prior crop year(s); audits may occur in person or remotely, typically no more often than every 3 years

Subpart B — State and Tribal Plans (7 sections): parallel obligations mirror Subpart C requirements — states must require producers to report acreage to FSA (§ 990.7), submit monthly reports to USDA by the first of each month listing each producer's contact details and license status (§ 990.70), and maintain the information-sharing system that gives law enforcement real-time access to producer and location data.

Subpart F — Reporting: states/tribes send monthly reports; USDA licensees submit acreage, sampling results, and disposal documentation; § 990.63 (Interstate Transportation) prohibits states from blocking the movement of lawfully produced hemp — hemp grown under any approved state plan or USDA license may cross state lines freely.

The Part 990 framework creates a tiered compliance architecture. State-plan states run their own licensing programs subject to USDA audit; federal-plan producers get USDA licenses directly. In both tracks, the critical compliance risk is the same: a pre-harvest sample returning a total THC result (including THCA conversion) above 0.3% triggers crop destruction with no commercial salvage option. The measurement uncertainty framework is the only buffer — a lab result of 0.35% with a MU of ±0.06% would still qualify the crop as acceptable hemp because the lower bound (0.29%) falls below the threshold. Recent rulemakings: 86 FR 5680 (Jan 2021) promulgated the final AMS hemp rules; 88 FR 82236 (2023) updated the acceptable hemp THC level definition and sampling protocols.

How It Works

State Plan vs. USDA Federal Plan

Most hemp producers operate under a state or tribal hemp plan rather than the USDA federal fallback. A state's plan must cover land record-keeping (3-year minimum), THC testing using post-decarboxylation methods, disposal procedures for non-compliant plants, annual random inspections, and a plan to submit producer information to USDA within 30 days of receipt. States can add stricter rules. USDA has 60 days to approve or reject a submitted plan. If USDA rejects it, the state can revise and resubmit.

If a state or tribe has no approved plan, producers there must get a federal license from USDA under the § 1639q framework. Growing without that license is a federal violation — not merely a civil matter.

The 0.3% THC Line

Hemp becomes marijuana the moment a plant's delta-9 THC concentration exceeds 0.3% on a dry weight basis. This threshold creates real agronomic risk: plants can drift above the limit due to weather, stress, or harvest timing. If a sample tests hot, the crop must be destroyed — there is no remediation option. USDA requires post-decarboxylation testing (or an equivalently reliable method), which accounts for THC-A converting to THC when heated, giving a more complete picture of potential potency than raw delta-9 tests alone.

Graduated Enforcement

The law's enforcement structure distinguishes carefully between mistakes and intentional violations:

• Negligent violations (failing to maintain land records, growing without a license, exceeding 0.3% THC by honest mistake): corrective action plan + 2-year compliance reporting; no criminal liability at any government level. Three negligent violations in 5 years → 5-year ban.
• Culpable violations (worse than negligence — deliberate or reckless): state or tribal regulators must immediately report the producer to the U.S. Attorney General and local law enforcement, and full criminal enforcement applies.

Real-Time Law Enforcement Data Sharing

USDA collects and makes available in real-time to federal, state, territorial, and local law enforcement: every licensed hemp producer's contact information, the legal land description of their growing area, and their current license status. This enables law enforcement to immediately verify whether a field of cannabis-looking plants is federally licensed hemp or illegal marijuana.

FDA and CBD

The hemp statute explicitly does not change FDA's authority over hemp-derived products like CBD oil. Section 1639r preserves the Federal Food, Drug, and Cosmetic Act and HHS authority fully. This is why CBD is in a legal gray zone for food and dietary supplements — USDA says hemp is legal to grow, but FDA has not approved CBD as a food additive or dietary supplement ingredient and has taken enforcement action against unapproved CBD health claims. A 2025 Farm Bill compromise was still pending as of early 2026.

How It Affects You

If you want to grow hemp: Start by checking whether your state has a USDA-approved state hemp plan — most agricultural states do. Find the current list at ams.usda.gov/rules-regulations/hemp — if your state has an approved plan, you apply through your state department of agriculture (not USDA directly). States like Kentucky, Colorado, Montana, North Carolina, Oregon, and New York have active hemp licensing programs with dedicated staff, extension resources, and sometimes state-specific variety restrictions or acreage limits.

If your state has no approved plan (check the USDA list — a small number of states still fall under federal administration), you apply for a USDA federal license directly through the USDA AMS hemp licensing portal. Either way, you'll need to register your production location with a legal land description accurate enough for GPS verification. You must agree to: maintain land records for at least 3 calendar years, submit to random pre-harvest inspection and sampling, and have your crop tested within 30 days before the anticipated harvest date (a window expanded from 15 days in the 2021 final rule). Testing is done by a USDA-approved DEA-registered lab using post-decarboxylation methodology — the result includes both delta-9 THC and potential conversion from THC-A to THC when heated.

The 0.3% THC threshold is the agronomic risk you can't fully control. Hot weather near harvest, plant stress, or delay in harvest can push delta-9 THC above the limit. If your crop tests above 0.3% on the pre-harvest sample, it's marijuana under federal law and must be destroyed — there is no remediation option. Build in your harvest timeline buffer with this risk in mind; many experienced hemp producers time harvest at 70-80% flower maturity rather than full maturity specifically to stay under the threshold. If you test hot: your state program or the USDA federal plan will issue a negligent violation notice if the excess appears to be inadvertent. A first or second negligent violation triggers a corrective action plan and 2 years of enhanced reporting — no criminal liability. A third violation in 5 years triggers a 5-year ban from the program.

Prior drug felony lookback: the 10-year disqualification applies to any felony under state or federal law relating to a controlled substance — not just marijuana. Marijuana-related felonies from before 2018 count. The only exception is if you participated in a pre-2018 hemp pilot program authorized under the 2014 Farm Bill. If you have a past felony and want to grow hemp, the disqualification period runs from your conviction or release date (whichever is later) to the date of your license application; consult with an attorney about your specific timeline.

If you're a farmer weighing hemp against other crops and considering federal support programs: Hemp's inclusion in federal programs is incomplete. USDA Risk Management Agency (RMA) offers federal crop insurance for hemp in selected states where programs have been expanded — check the RMA Agent Locator at rma.usda.gov and ask specifically about hemp coverage in your county, as availability varies significantly. Hemp grown for CBD flower is generally not insurable or insured at lower coverage levels due to market volatility and price uncertainty. Hemp grown for grain or fiber has slightly better coverage availability.

FSA programs: hemp producers must be registered with FSA and report hemp acreage through the Farm Service Agency's Annual Acreage Reporting (Form CCC-576 or equivalent) to maintain farm program eligibility. Hemp acreage counts against your farm's total acreage for various program purposes. The Farm Bill uncertainty (the 2018 Farm Bill's hemp provisions have been operating under extension since September 2023) means the hemp program lacks a fresh 5-year authorization — creating regulatory uncertainty about testing methodology, the felony lookback period, and potential changes to the THC threshold. Until a new Farm Bill passes, operate under the current rules at ams.usda.gov/hemp.

If you're selling CBD products derived from hemp: USDA's licensing framework covers the agricultural production of hemp. The legal question mark for CBD is entirely on the FDA side. FDA has authority over hemp-derived products used as food, dietary supplements, cosmetics, or drugs — and as of 2026, FDA has not approved CBD as a food additive, dietary supplement ingredient, or otherwise permitted CBD in human food products under the FDCA.

FDA's 2023 announcement that it would not create a regulatory pathway for CBD in food — combined with no new Farm Bill to address the gap — has left the CBD supplement and food market in a legal gray zone. What that means practically: topical CBD products (creams, lotions, balms) face lower FDA risk than ingestible CBD (tinctures, gummies, beverages), because the FDCA's food additive and supplement provisions don't apply to cosmetics. Making drug claims for any CBD product (e.g., "treats anxiety," "reduces inflammation") without an FDA-approved new drug application is illegal regardless of how the hemp was grown. Selling CBD products with no health claims and clear labeling is lower risk, though still not fully authorized. Monitor FDA's hemp-derived CBD enforcement actions at fda.gov/food/cfsan-constituent-updates — enforcement letters are the clearest signal of FDA's current priorities.

State Variations

State hemp programs vary substantially:

• Well-developed programs: Most agricultural states (Kentucky, Colorado, Montana, Oregon, North Carolina) have approved state plans with dedicated hemp licensing offices, testing requirements, and sometimes state-specific acreage limits or variety restrictions.
• More restrictive states: Some states prohibit smokable hemp flower even though federal law permits it, because their state laws have stricter definitions.
• States without approved plans: Producers must use the USDA federal licensing system directly.

State and tribal laws that are stricter than the federal standard are explicitly preserved under § 1639p.

Pending Legislation

The 2025 Farm Bill (still pending as of April 2026) is expected to address the THC testing methodology debate, update the felony look-back rules, and potentially clarify the CBD-in-food regulatory gap between USDA and FDA. Industry groups are lobbying for a total THC testing standard (including THC-A) to align with current DEA enforcement posture.

Recent Developments

• 2023 Farm Bill stalled — hemp regulatory framework in limbo: The 2018 Farm Bill authorized USDA's hemp production program and directed FDA to develop a pathway for hemp-derived CBD in food and dietary supplements. The 2018 Farm Bill expired September 2023 and has been extended under continuing resolutions without a new five-year authorization. Without a new Farm Bill, the hemp program operates under extended authority; critically, FDA never established the food/supplement framework for CBD that the 2018 Farm Bill contemplated. FDA's 2023 announcement that it would not pursue a CBD food additive pathway — leaving CBD in regulatory limbo — has depressed hemp market investment and grower willingness to enter the CBD-focused hemp sector.
• Delta-8 THC market expansion — federal-state enforcement gap: Delta-8 THC (a psychoactive hemp-derived cannabinoid produced by chemically converting CBD) has created the most significant hemp regulatory controversy since the 2018 Farm Bill. Delta-8 products are sold in gas stations, convenience stores, and online in states where recreational cannabis is illegal, because federal hemp law regulates only delta-9 THC content. USDA's hemp program covers the cultivation testing threshold but does not address delta-8 products at the retail level. DEA's interim rule (September 2023) addressed some conversion chemistry concerns; 21 states have banned or restricted delta-8; the remaining states and the federal government have not resolved the fundamental regulatory gap between hemp and cannabis.
• Hemp commodity price collapse — producer exits reshaping the industry: Hemp acreage — which surged from near-zero to 465,000+ acres in 2019 following the 2018 Farm Bill — has contracted dramatically. CBD market oversupply, FDA's failure to regulate CBD supplements, and competition from delta-8 alternatives have collapsed hemp flower and CBD crude prices by 80-90% from peak levels. Many USDA-licensed hemp producers have exited; surviving producers have shifted toward fiber hemp (for textile and building materials) and grain hemp (for food and industrial uses) rather than CBD flower. USDA's hemp program has seen application volumes decline substantially from peak years.
• 2024 Drug Testing and USDA sampling — "hot hemp" enforcement: USDA's hemp sampling and testing program (requiring pre-harvest testing within 30 days of harvest under the 2021 final rule) remains the primary regulatory gatekeeping mechanism. "Hot hemp" — plants that exceed the 0.3% THC threshold at testing — must be destroyed; producers bear the full cost of crop destruction plus production loss. The DEA's total THC (delta-9 + THC-A conversion) testing standard, reaffirmed in 2023, means that high-THCA flower — popular in some markets because it's non-psychoactive until heated — faces stricter testing standards than delta-9-only testing would impose. State hemp plans approved by USDA must conform to the federal THC standard, creating compliance complexity for states that had previously used delta-9-only sampling.
• 2025 Farm Bill still pending — USDA program extended again: As of April 2026, Congress has not enacted the 2025 Farm Bill. The hemp production program continues under short-term extension authority. Industry groups remain deadlocked with regulators over total THC testing methodology, CBD food additive pathways, and how the Farm Bill should address the delta-8/delta-9 market gap. The absence of a new Farm Bill means USDA cannot update its hemp regulations to address the synthetic cannabinoid market that has emerged since 2018.
• RFK Jr. FDA posture — CBD regulatory path uncertain: Under HHS Secretary Robert F. Kennedy Jr., the FDA's approach to consumer cannabis products — including hemp-derived CBD — remains unpredictable. Kennedy has expressed skepticism of traditional pharmaceutical pathways but has not pushed for a clear CBD food additive framework. The FDA's 2023 refusal to establish a CBD supplement pathway has not been reversed; industry advocates hoped the new administration would break the logjam, but no regulatory action has materialized as of April 2026.
• DEA Schedule III rescheduling — hemp/cannabis boundary complexity: The Biden-era DEA proposal to reschedule marijuana from Schedule I to Schedule III (announced 2024) remained in administrative process through early 2025. The Trump administration has not reversed the rescheduling process outright, though its trajectory is uncertain. Hemp's legal status depends on the delta-9 THC threshold, not scheduling; but rescheduling marijuana would narrow the practical gap between regulated cannabis and the delta-8 THC hemp market, with unpredictable consequences for producers and retailers operating in that gray zone.