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USDA: Hemp Eligible For Federal Crop Insurance

The U.S. Department of Agriculture announced that hemp grown for fiber, flower or seeds will now be eligible for federal crop insurance.

Industrial Hemp growers will be able to obtain insurance coverage under the Whole-Farm Revenue Protection or WFRP program for crop year 2020, the USDA said.

WFRP allows coverage of all revenue for commodities produced on a farm up to a total insured revenue of $8.5 million. It is popular for specialty crops, organic commodities and non-traditional crops.

According to the USDA's Risk Management Agency or RMA, the crop insurance coverage will be available to producers who are in areas covered by USDA-approved hemp plans, or who are part of approved state or university research pilot programs.

"Numerous producers are anxious for a way to protect their hemp crops from natural disasters. The WFRP policy will provide a safety net for them. We expect to be able to offer additional hemp coverage options as USDA continues implementing the 2018 Farm Bill," said RMA Administrator Martin Barbre.

The latest move by the USDA comes following the passage of the 2018 Farm Bill, which has legalized hemp production in the U.S.

The Farm Bill defines hemp as containing 0.3 percent or less tetrahydrocannabinol or THC on a dry weight basis. THC is the psychoactive compound in marijuana that gives users a high.

To be eligible for the federal crop insurance, hemp producer must be compliant with applicable state, tribal or federal regulations for hemp production and have a contract for the purchase of the insured industrial hemp.

The USDA's Agricultural Marketing Service or AMS is formulating regulations that will include specific details for both a USDA plan for the production of hemp, and a process for submission of state, territorial or tribal plans to the agency.

AMS is currently developing the regulation, which is anticipated to post to the Federal Register later this year.

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