The future of Michigan’s hemp program is taking shape. State Senator Kevin Lauwers has introduced two crucial bills, Senate Bill 850 and Senate Bill 852, designed to transition our state from a pilot program to a permanent one under the USDA’s final rules.
This is the moment we have all been working toward. The “wild west” of the pilot program is ending, and a more structured, permanent industry is beginning. We have read through the proposed legislation and identified three critical changes that every current and future hemp grower and processor needs to understand.
1. A New Market: Selling Hemp to Licensed Marijuana Processors
This is a landmark change. Section 313 of the proposed bill states:
“A grower may sell industrial hemp to a processor that is licenced under the medical marihuana facilities licensing act…”
What it means for you: This is a game-changer for Michigan’s cannabinoid farmers. It officially opens a new, regulated, and potentially lucrative sales channel for your biomass and flower. It bridges the gap between the two industries, allowing licensed cannabis companies to source CBD and other hemp-derived cannabinoids directly from Michigan farmers for use in their products. This could significantly stabilize the market and create new business relationships.
2. Increased Grower Fees
The annual grower registration fee is set to increase to $1,250.
What it means for you: While no one likes higher fees, this increase is a necessary step toward a stable, long-term program. The initial pilot program fees were not sufficient to cover the full operational costs for the Michigan Department of Agriculture and Rural Development (MDARD).
This new fee structure is intended to fully fund the department’s overhead for inspections, licensing, and compliance, ensuring the program is professionally managed and sustainable for years to come.
3. New Reporting and Approval Requirements
The legislation introduces new language requiring farmers to report all sales of hemp and indicates that state approval may be needed before selling to a processor.
What it means for you: This signals a more tightly regulated and transparent industry. Mandatory sales reporting allows the state to gather accurate data on the size and scope of Michigan’s hemp market, which is critical for future planning and investment. The requirement for sales approval, which we are working to clarify, is likely tied to ensuring that all hemp enters a compliant, licensed supply chain.
The Good News for 2020
It is important to remember that for the current 2020 growing season, we are still operating under the existing Pilot Program rules until October 31st. This gives us all one more season to experiment, gather data, and perfect our methods before the new regulations take full effect.
Navigating these changes is exactly why iHemp Michigan exists. We are in direct communication with legislators and MDARD to provide feedback and get clarity on these new rules on your behalf.
Join iHemp Michigan today to support our advocacy and ensure you always have the most up-to-date information to keep your business compliant and successful.
For your convenience, you can review the full text of the bills here: