CannabisNewsWire
Editorial Coverage: Recent changes in Washington, D.C., are
good news for the U.S. hemp industry.
- The recent departure of Jeff Sessions from the Attorney
General’s Office may make it easier for states to enforce their own
laws in relation to cannabis and hemp legalization.
- The Democratic majority in the House may ease the passage of
the delayed Farm Bill.
- These changes could improve the prospects for hemp and cannabis
producers.
Marijuana Company of America Inc. (OTC: MCOA) (MCOA
Profile) is a pioneer in the hemp industry, with trial
cultivation operations under way in Washington and a range of
hemp-derived products on the market. Charlotte’s Web
Holdings, Inc. (OTCQX: CWBHF) (CSE: CWEB) is also focused
on hemp-derived cannabidiol (CBD) products and recently raised its
profile through TV coverage. Even before the prospect of reform,
CV Sciences, Inc. (OTCQB: CVSI) was seeing record
profits this year and increased its profile by becoming a sponsor
for the Hemp Industry Association’s 25th anniversary conference.
Isodiol International, Inc. (CSE: ISOL) (OTCQB:
ISOLF) is benefiting from changes not just in the United
States but in Mexico, where new regulations will support its sale
of diverse CBD products. The first publicly traded U.S. cannabis
company, Medical Marijuana, Inc. (OTC: MJNA) is
also seeing growth, with record sales and a continuing high
profile.
To view an infographic of this editorial, click here.
A United Group within a Divided Nation
This November’s Congressional elections have been some of the
most divisive in U.S. history. Bitterly fought campaigns have
culminated in knife-edge results, featuring recounts to settle tiny
vote margins amid loud accusations of cheating from both sides.
While the election results and their aftermath have been mixed
for both Democrats and Republicans, they have been overwhelmingly
positive for one group — hemp producers. A Democratic majority in
the House of Representatives may finally bring an end to months of
bickering over this year’s Farm Bill renewal, leading to the
expected federal legalization of hemp farming in the process. And
the forced resignation of U.S. Attorney General Jeff Sessions,
which President Donald Trump pushed once the elections were over,
has removed one of the biggest stumbling blocks the industry
faced.
How Sessions’ Departure Affects Hemp
The resignation of Jeff Sessions was welcomed with relief by
companies in the hemp sector, including Marijuana
Company of America Inc. (OTC: MCOA), just as his
arrival was greeted with disappointment two years before.
During his election campaign, Trump had supported medical
cannabis and states’ rights to legalize their own industries. This
was good news for hemp companies, which expected to function as the
primary producers of medical cannabis.
Hemp, which does not get users high and is useful for a variety
of purposes, was banned by the sweeping laws of drug prohibition
decades ago. Recent state-level reforms have allowed the
establishment of projects such as MCOA’s hemp
project in Scio, Ore, in conjunction with their joint venture
partner Global Hemp Group Inc. But tension has existed for years
between state-level legalization and the continuing federal
prohibition on all forms of cannabis. Trump’s offer of reform
appeared to be a solution.
Then Sessions came into office. As the government’s top law
enforcement officer, he had the power to clamp down on all things
cannabis related. And as a vociferous opponent of cannabis, that
was exactly what he promised to do.
Though Sessions was not able to launch a new escalation of the
war on drugs, his stance on the subject frustrated cannabis
proponents. Even as brands such as
MCOA’s hempSMART brought a state-legalized flood of
hemp-derived products to the health and wellness markets, Sessions’
presence threatened to stifle the fast-growing industry.
However, the cannabis trade and surrounding industries continued
to grow despite Sessions’ presence. MCOA is a shining example of an
industry-savvy company that has recognized opportunities for growth
and development in an industry that reached an
estimated value of $9 billion in 2017 and is expected to reach over
$47 billion by 2027. The company developed a distinct hemp
derived CBD brand — hempSMART™ — and established high yielding hemp
cultivation farming projects in the United States and Canada while
also investing in Moneytrac Technology, a business providing
financial and support services for the cannabis industry.
However, federal restrictions have created uncertainty for
companies. By this fall, the White House was hinting at taking a
more liberal stance. While this could be seen as a political ploy
to balance Sessions’ presence in the minds of cynical
cannabis-conscious voters, it also hinted at divisions within the
government. It’s hardly surprising with a populist president like
Trump. With 64 percent of
Americans supporting legalization of cannabis and 74 percent supporting states’ rights to legalize,
Sessions was up against the popular view on a widely discussed
issue. Though both his appointment and his departure were driven by
other factors, his absence opens the way for cannabis reform. And
in fact, cannabis companies’ stocks initially rose when the news
was announced.
But Sessions’ departure wasn’t the biggest issue for hemp
companies such as MCOA. These companies are also closely watching
what is happening in the House.
Passing the Farm Bill
The 2018 Farm Bill is one of the most important pieces of
legislation the hemp industry has ever seen. A wide-ranging bill
covering U.S. agricultural and food policy, it includes provisions
that would legalize the large-scale cultivation of industrial
hemp.
Under the previous Farm Bill of 2014, such cultivation became
legal on a limited scale for purposes of research and trial crops.
This led to hemp crop development, such as the cultivation
harvested by MCOA this fall at its Oregon site, but not wide-scale
production.
The hemp provisions in the 2018 bill are set to change that.
Given their potential to offer a profitable new crop for struggling
farmers in Republican-held districts, the provisions have gained
cross-party support and ensured a place in the bill.
Unfortunately, other provisions have been more controversial.
Arguments over how to allocate federal food assistance and how to
deal with illegal immigration stalled the bill earlier in the year,
and arguments over who will benefit most from the funds have
prevented compromise in the months that followed. The future of
hemp companies such as MCOA has been in limbo thanks to issues that
have nothing to do with hemp.
With the Democrats about to gain control of the House, that
appears likely to change. The biggest hurdle to passing the bill is
House Republicans’ desire to set tougher controls for allocating
food stamps. But neither Democrats nor Senate Republicans favor
these strict rules, so a Democratic majority in the House and the
Republican-majority Senate could break the impasse and pass a bill.
This has also given Republicans more incentive to pass the bill
while they still have power to shape its outcome in the House.
Greater Opportunities for Cannabis
Companies
This change is great news for MCOA. As an industrial hemp
company, its operations have so far been limited by the provisions
of the 2014 Farm Bill and legalization in specific states. The
legalization of hemp will allow it to expand its existing
cultivation, set up new operations and more easily sell its
products into markets across the country.
Plenty of hemp and cannabis companies across the United States
will be seizing opportunities created if federal prohibition ends.
Many of these companies, such as Charlotte’s Web Holdings,
Inc. (OTCQX: CWBHF) (CSE: CWEB), are focused on products
using CBD. Its widespread use in health and wellness products has
propelled these companies into the limelight, with Charlotte’s Web CEO Hess Moallem appearing on CNBC to
talk about the growth of CBD and cannabis businesses in the
country.
Politicians’ willingness to change their stance on hemp is
unsurprising given the growing momentum behind the industry. The
Hemp Industry Association is throwing its 25th anniversary
convention this year. The milestone event, sponsored by CV
Sciences, Inc. (OTCQB: CVSI), marks two-and-a-half decades
of revival for a once-powerful industry. The sponsorship
opportunity has been hugely beneficial for CV Sciences, which
saw record sales and gross profits in the third
quarter of 2018.
Isodiol International, Inc. (CSE: ISOL) (OTCQB:
ISOLF) is another company focusing on CBD. Its products
cover a wide spectrum of uses, including sleep aid, pain management
and skin needs. While the political changes in the United States
appear positive for Isodiol, the company has also been closely
following events in Mexico, where it has distribution agreements
with several companies specializing in pharmaceuticals. At the end
of October, Mexican authorities published new
regulations covering CBD products. These allow hemp to be used
in cosmetics, food supplements and herbal products, as well as in
medicines. Based on these changes and its established agreements,
Isodiol expects to start sales in Mexico in early 2019.
Medical Marijuana, Inc. (OTC: MJNA), the first
publicly traded cannabis company in the United States, continues to
go from strength to strength. Its subsidiaries have been exhibiting
at events across America this year as it continues to develop its
profile. Like CV Sciences, it has recently seen
record sales as the cannabis and CBD markets grow across North
America and beyond.
The hemp industry is growing around the world but, with change
in the cards in Washington, America appears set to stay at the
forefront of the industry.
For more information on Marijuana Company of America, visit
Marijuana
Company of America, Inc. (OTC: MCOA)
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