In the UK, CBD can be sold legally. However, extracting it from hemp is still not allowed, meaning the country imports all of its CBD. How can extracting CBD locally benefit the UK’s economy, farmers, and regulation of the controlled-substance? And with the booming industry and stricter Novel Foods regulation on selling CBD, can we expect this puzzling restriction to change any time soon?
What are the Current Rules on Growing Hemp in the UK?
Cannabis sativa L. is the name of the plant whose species include hemp and marijuana. Marijuana contains an active ingredient called Tetra-Hydro-Cannabinol (THC), which is a psychotropic substance that creates the ‘high’ feeling often associated with cannabis. This is banned in the UK and most countries around the world, though in some places it is legal, including Canada, Portugal, the Netherlands and some parts of the US. CBD products are made from hemp, which has less than 0.3% THC, and are legal in the UK. They have many proven health benefits and have become a staple part of the UK high street.
At the moment, UK hemp farmers are allowed to grow industrial hemp for its fibres, which is used to produce a wide range of products from cloth and cosmetics to rope and detergents. However, the leaves and flowers of the hemp plants, which contain the CBD oil, must be destroyed. In the EU, it is lawful to extract CBD, which increases the value of the crop. By not being allowed to do the same in the UK, hemp farmers and the UK economy at large are losing out on large sums of money.
Is Any Part of the British Isles Licensed to Extract CBD?
The only place in the British Isles that has granted licences for hemp extraction is Jersey, which is a Crown Dependency and has a measure of autonomy within its constitutional relationship with the UK. In 2019 a group of hemp farmers set up a company called Jersey Hemp and developed a fire-resistant building material called Hempcrete from hemp fibres, which can be used as a non-toxic insulator in house building. They were given a license to use the whole of the plant which allowed them to produce around 40 tonnes of dry hemp annually, 3-5% of which was used for CBD.
David Ryan, chief executive of Jersey Hemp, said: “It will allow us to supply products made using CBD with clear British provenance to retailers and the general public. The market for CBD products is growing rapidly as it becomes increasingly recognised for its nutritional benefits and for general wellbeing. The fact that we can produce the oil for ourselves legally here in Jersey will massively reduce our costs now that we don’t have to import CBD anymore. We can do it all under one roof and then sell directly into the UK and beyond.”
What are the Benefits for the UK Economy in Legalising CBD Extraction?
As the Jersey farmers have found, removing import costs when creating products increases the profit margin for CBD producers. The consumer CBD market in the UK is now worth £690 million a year and is expected to reach £1 billion per year by the end of 2025, yet the bulk of this profit is lost to foreign suppliers. Because only the hemp fibres of the plant can be used, farmers end up burning approximately 90% of their potential revenue. A field of 15 acres can make around £12,000 profit from hemp products, but if farmers were allowed to use the CBD producing parts of the plant as well, it would rise to nearly £100,000. Allowing CBD extraction would encourage investment in the UK, create high-skilled jobs and stimulate the scientific research and development sector.
As well as having a positive effect on the UK economy, hemp production could also help the UK become a world leader in the fight against climate change. Hempcrete is a net carbon zero, sometimes carbon negative, building material and is highly effective at carbon sequestration, rapidly catching CO2 from the atmosphere. Hemp absorbs 15 tonnes of CO2 per hectare, which is roughly equivalent to 34,500 miles travelled by a car.
When is the Law Likely to Change?
A report co-authored by the Association for the Cannabinoid Industry (ACI) and Centre for Medicinal Cannabis (CMC) called ‘Green Shoots - Sowing The Seeds Of The New UK Cannabis Industry’ sets out 20 recommendations that will maximize growth and innovation in the CBD sector. One of these recommendations is the need to reform the rules around hemp farming to allow farmers to harvest the whole plant.
Given the sector's clear potential for huge growth over the next few years, the report spells out the reasons why the government should adopt a proactive strategy for the cannabinoids sector. Steve Moore, co-founder and strategic counsel to the ACI and CMC said: “With new government support the accidental consumer cannabis revolution that has allowed CBD to become available on every high street in the UK could become permanent, nurturing hundreds of businesses, thousands of jobs and billions of pounds in exports.”
The rules around CBD have changed recently, with CBD products now counting as novel foods. This means they must have been through an approval process to check that they do not pose a danger to consumers. These rules create a clear compliance route for CBD companies and allows for complete traceability and transparency in the supply chain.
By regulating what was until recently a mostly unregulated industry, the FSA has taken the first step towards changing more laws for CBD producers. It can only be a matter of time before the government gets on board and legislates to grant hemp farmers commercial licenses that will enable them to grow and distribute the whole plant, and allow the CBD industry in the UK to flourish.