US lawmakers finally struck a deal for the landmark 2018 Farm Bill on November 29, ending months of partisan debate and kicking off a new era of hemp-derived cannabinoid markets. The bill effectively legalizes hemp growing for the first time in nearly a century, and opens up the possibilities for the production of cannabidiol (CBD).
Containing less than 0.3% tetrahydrocannabinol (THC), the psychoactive ingredient in marijuana, hemp is technically speaking a species of the cannabis plant. However, hemp’s medicinal value comes from THC’s non-psychoactive cannabinoid cousin CBD, which is already being infused into all types of consumer products, and more are soon to come. With this newly reached agreement, CBD will no longer be in a legal grey area.
Back in September, the US Drug Enforcement Agency (DEA) downgraded CBD from a Schedule I drug to Schedule V, allowing for FDA-approved drugs to contain the cannabinoid.
CBD’s market potential has already been projected to reach $22 billion by 2022 thanks to its non-intoxicating nature. The mainstream potential for CBD products is quite high, even for people uncomfortable with consuming cannabis products that contain the psychoactive cannabinoid, THC.
Pre-rolled CBD cigarettes are already starting to catch on in popularity, while new beauty products are cropping up with CBD in their list of ingredients-it’s official that CBD is going mainstream. Now the market is anticipating a flood of new CBD-infused products to soon hit the market across all 50 states.
The Farm Bill is triggering a CBD wave. Companies with more CBD offerings are better positioned to profit from this growing product category than their competitors that are more invested in unrefined cannabis. The result may ultimately make the “CBD-heavy” pot stocks better long plays than their more THC-friendly peers.
Over the long term, the CBD market is projected to offer a compound annual growth rate of 147% through 2022. Versatility is CBD’s strongest factor, given that it can be incorporated into oils, capsules, vapes, infused beverages, edibles, and pretty much any alternative form of consumption you can think of.