Industrial Hemp is Coming to New Mexico

State Supreme Court decision legalizes hemp research and cultivation; Ag Department working on rules

With the New Mexico Supreme Court's ruling this week that Gov. Susana Martinez violated the state Constitution by vetoing 10 bills without explanation, industrial hemp growing and research have been indisputably legalized under state law.

The economic implications could be huge.

The two bills that paved the way for hemp, sent to Martinez in early 2017, outline how New Mexico State University and the Department of Agriculture should coordinate to create a research program and issue licenses for growing hemp crop.

The one that passed later, sponsored by Sen. Cisco McSorley (D-Bernalillo), is most likely the one that will become law, admits Rep. Bealquin "Bill" Gomez (D-Doña Ana), who sponsored the earlier bill.

“[McSorley’s] is a little better than mine because it opens [hemp growing and research] up a lot more,” Gomez tells SFR by phone. “Ours was following the federal law more strictly, but either bill will help our families, that’s the important thing.”

McSorley did not return several phone calls seeking comment.

The new law permits the New Mexico Department of Agriculture to issue licenses to people, businesses, and institutions of higher education to grow hemp. It directs the department to create requirements for licensure, a protocol for training state law enforcement in handling the crops, establish fees, and institute quality control for growers.

In addition, the law directs NMSU to create a hemp research and development fund with fees collected by the agriculture department in its administration of the hemp program, as well as any donations, grants and other income taken in by the fund.

In an email, spokeswoman Kristie Garcia said the state agriculture department would now "initiate the rule-making process."

"This will entail the drafting of rules, which will go before a hearing officer, then the NM Secretary of Agriculture [Jeff Witte] will ask the NMSU Board of Regents to adopt said rules," Garcia wrote. The secretary of agriculture is appointed by the regents of New Mexico State University.

Rep. Bill McCamely (D-Doña Ana), who was part of the committee that evaluated the hemp bill, says the impact of the new law largely depends on the rules that the agriculture department and NMSU put in place.

"If [the state] says, 'We will only grow on our own farm land,' that won't help farmers," McCamely says, "but if there's processes allowing farmers to grow and participate in the research process, that will benefit individual farmers."

Gomez says hemp's versatility and low water usage make it a potential cash crop as well as a vessel for new manufacturing jobs in his district in Doña Ana County.

“It’s key that we process and manufacture products here, whether it’s [hemp seed] oil or textiles, we really want to take advantage of it,” says Gomez. “There are a lot of benefits to the farming part, but the real benefit comes from manufacturing and [exporting] those products.”

The Hemp Business Journal, a leading trade publication, found that the highest consumer sales for hemp in 2016 were in personal care products such as skin creams, foods (including products made from hemp seed and oil), consumer textiles and industrial applications. All consumer sales of hemp products for that year totaled $688 million nationally.

Sales of products containing cannabidiol (CBD) derived from hemp outsold all other consumer products except personal care. CBD is a non-psychoactive compound found in cannabis flowers renown for its healing properties, and can be extracted from hemp or marijuana.

You can't get high off hemp, but owing to its similarity in appearance to marijuana and the fact that both are technically "cannabis," the federal government's relationship to hemp has been incoherent at best. The law says hemp must contain less than .03 percent THC—but since it's a variety of the cannabis plant, hemp is still illegal under federal drug laws passed in the 1970s.

In October 2001, the Drug Enforcement Administration even tried to ban food products containing hemp. The Hemp Industries Association, a trade group, sued the DEA in response, and in 2004 the Ninth Circuit Court of Appeals "rejected the DEA's hemp food ban on substantive grounds," according to the book Smoke Signals: A Social History of Marijuana by Martin A. Lee.

A federal farm bill in 2014 allowed New Mexico and other states to permit universities and state agriculture departments to cultivate hemp for limited purposes. So while hemp is still classified as a Schedule 1 controlled substance under federal law, its cultivation within the guidelines of the 2014 bill is legal. New Mexico now joins the majority of states in allowing the cultivation of hemp for commercial, research, and pilot program purposes.

Some states interpret [the 2014 farm bill guidelines on hemp growing] broadly and allow commercial activity,” says Erica McBride, executive director of the National Hemp Association, a trade group. “Some states only allow universities to plant small test plots for research. And then there’s everything in between.”

Earlier this month, US Senate Majority Leader Mitch McConnell (R-KY) introduced federal legislation that would remove hemp and other non-psychoactive varieties of cannabis from the Controlled Substances Act, allow researchers to apply for funding from the federal Department of Agriculture and permit hemp farmers to apply for crop insurance.

"Although the 2014 Farm Bill allowed for hemp pilot programs, some farmers have still faced substantial disputes with some federal agencies," McConnell recently wrote in a guest column for the Louisville LEO, an alt-weekly newspaper. "This bill will remove roadblocks and encourage the domestic growth and production of hemp."

The direction of New Mexico's hemp program is still developing, and if McConnell's federal hemp bill becomes law, the scope of possibility for the industry here would widen. The state bill seems to have accounted for such liberalization at the federal level, according to McBride.

New Mexico's hemp law "seems to have flexibility in it to expand as federal law evolves," McBride writes in an email. "Now everything will ride on how the [New Mexico Department of Agriculture] interprets and implements it."

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