Should You Be Under Contract to Process CBD in 2021? An Open Letter From Eric.
Attached is our view of New York’s NYS DOH “Hemp Rules and Regulations” (Oct. 26, 2020), the first Rules and Regulations to be adopted in the nation. Adoption significantly changes how the HEMP, Processor, Manufacturer and Grower must function going forward in 2021.
These Rules regulated an unregulated hemp industry characterized as “the wild west”. The industry, government and consumer will benefit once the new “Rules” are in place, and enforced.
Grower perspective: MINOR changes as to when, where and how to test the CBD/THC content of the crop prior to harvest. More tracking, possible NYS crop inspections. Hot crops can now be blended to get to the 0.3% THC limit; previously “hot crops” were destroyed. The “blending” rule is significant.
Processor Perspective: MAJOR changes. The Processor must now be cGMP certified, e.g. meet Food Grade Standards. cGMP Certification will be difficult for many to achieve for several reasons: 1. Lengthy and time consuming process (a year or more). 2. Requires specialized consultants to write a plan specific to that particular processor. Plans. several
hundred pages long detail each function at the processors facility. 3. cGMP compliance requires extensive facility modification – clean rooms, floor drains, HVAC, security systems, etc. Sometime modifications can’t be made to existing facilities. 4. cGMP must be done on an “ongoing basis”, e.g. always. Many small businesses who presently have Processor licenses may be unable to justify the time or expense, or simply miss the “time window” to be licensed.
There are 70 current NYS Hemp processor licensees, 25 have websites, 15 claim to be “processing”. Most aren’t cGMP.
The new cGMP requirement narrows this to possibly 10 processors qualifying for 2021 NYS DOH licensing.
Manufacturer Perspective: NYS DOH now requires a Manufacture License to package, label and sell CBD products. The licensee and its facility also must be cGMP certified. cGMP expense for a small company isn’t viable, however the Processor (who can also include a Manufacture License) could provide the “packaging, labeling” function.
THESE CHANGES WILL SIGNIFICANTLY AFFECT GROWERS:
Growers would be wise to select a Processor and contract with them in advance of planting the 2021 crop.
Northeast Extracts would be pleased to offer our drying and extraction services (and maybe Manufacture) for your current or future needs. Please give us a call so we can respond to your needs.