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December 17, 2018

Congress Votes to Legalize Hemp

The landmark development could greatly impact the apparel industry.

By  John Corrigan

The evolution of the cannabis industry continues as Congress has voted to legalize hemp, a monumental decision that opens up a world of opportunities for the apparel industry.

The legalization of hemp – a variety of the cannabis plant that doesn’t get you high – was included in the $867 billion farm bill, which mostly deals with agriculture subsidies and food assistance programs, Vox reported. The House of Representatives approved the bill in a 369-47 landslide last week, after the Senate approved it 87-13. President Donald Trump is expected to sign the bill into law.

Senate Majority Leader Mitch McConnell spearheaded the campaign, claiming hemp can help replace tobacco as a key crop for Kentucky’s farmers. Hemp fibers and stalks can be used in clothing, paper, carpet, construction materials and many other products.

The new bill would put the U.S. Department of Agriculture and state agencies in charge of hemp regulations. Farmers would be granted access to banking, water rights and crop insurance. Plus, researchers would be able to apply for federal grants to study further uses of hemp. As a result of the legislation, the U.S. cannabis industry could grow to $20 billion by 2022, up from $800 million this year, Fortune reported.

Several industry suppliers are excited about the potential opportunities that the legalization of hemp can provide. “It is like an industrial revolution,” says Glen Brumer, sales director at New York-based Royal Apparel (asi/83731). The company has been supplying viscose hemp T-shirts and V-necks over the last few years. “Our product has introduced us to many areas of the hemp industry, from advocacy groups to various companies that support it. From our experience, we have seen the positive impact it has on business.”

Fellow New York-based supplier Devara (asi/49470) entered the cannabis market this year, developing a retractable name badge reel made partly of hemp. “It has done fairly well so far,” says Joe Fina, vice president of Devara. “Hemp becoming more and more mainstream is certainly going to help.”

Econscious (asi/51656), one of the leading eco apparel brands in the industry, has offered hemp blend fabrics for hats and bags for a couple years. “The recent vote to legalize industrial hemp represents a momentous leap forward in the long-standing campaign to bring hemp cultivation back to the United States,” says Kriya Stevens, director at Econscious. “The potential benefits to American farmers, consumers and industry are incredibly exciting. We are hopeful that this vote is signed into law because hemp truly represents one of the most versatile crops around, with the potential to create tremendous economic and environmental benefits for our country.”

Legislation dating back to 1937 made the growing of industrial hemp (because of its ties to cannabis) illegal, forcing Americans to import the crop from other countries as long as it contains scant levels of THC – the psychoactive constituent in cannabis. But a provision in the 2014 Farm Bill opened the door for growing hemp in certain states.

Nebraska-based Bastcore was the first to capitalize on the provision, inking a contract with Los Angeles-based Recreator to supply American-grown hemp fiber for apparel. John Lupien, CEO of Bastcore, says that hemp becoming legal simplifies the production process, loosening restrictions such as which states to retrieve the crop from and how to transport it. “It’s a big deal for us,” Lupien says. “This alleviates some of the concerns institutional investors might have in terms of what’s the likelihood of hemp being legal. After all, it takes capital to get this scaled up if you want to see hemp in more T-shirts.”