Industrial Hemp: FSA Reminds County Offices “No Loans on Hemp for 2019 Season”

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The USDA Farm Service Agency today issued an update to state and county FSA offices regarding implementation of the 2018 Farm Bill. The update (Notice FLP-798) generally outlines changes (e.g. loan amounts and eligibility) in the new 2018 Farm Bill, and includes an assurance that USDA is on track to issue rules regarding industrial hemp production in the Fall of 2019 well in advance of the 2020 production season.

The update advises that income from previous years’ hemp crop may not be used to demonstrate cash flow for direct or guaranteed loan applications. Additionally, FSA may not issue loans for production of industrial hemp for the 2019 season yet to be planted. Until regulations under the 2018 Farm Bill for industrial hemp are promulgated, FSA is still operating under 2014 Farm Bill rules which do not include industrial hemp as an agricultural crop.

For anyone attempting the application for a production loan for the 2019 hemp crop, he or she can expect to read the following in their adverse decision letter:

“Section 10113 of the 2018 Farm Bill directs USDA to issue regulations and guidance to implement a program for the commercial production of industrial hemp in the United States. At this time, USDA has not issued regulations and anticipates having the regulations in place by the 2020 planting season. For the 2019 planting season, the 2018 Farm Bill provides that States, Tribes, and institutions of higher education can continue operating under authorities of the 2014 Farm Bill that do not permit approval of your loan application. Questions or requests for information about the commercial production of industrial hemp should be e-mailed to farmbill.hemp@usda.gov.”