By Jean Lotus
Some hemp companies are finding that shipping hemp products in the United States has suddenly become more difficult, and the reason why may be buried in the December’s COVID-19 Economic Relief Act.
A federal clampdown on shipping vaping products was inserted in the dense legislation signed by then-President Donald Trump as amendments to the Jenkins Act and the Prevent All Cigarette Trafficking (PACT) Act.
The new rules have caused a disruption in the shipping industry, said Los Angeles attorney Andrea Golan of Vicente Sederberg. The company offers legal expertise in shipping cannabis and hemp/CBD products.
“The PACT act amendment has turned everything upside down for hemp vaporizer shippers,” Golan said. That’s spilling over to other hemp products, “raw, processed or finished product,” Golan added.
The vaping-related EVALI lung-disease crisis sickened thousands and killed about 70 people in 2019. Federal health investigators determined it was caused by illicit THC vapes, adulterated with petroleum oil, mostly trafficked through the internet.
The new amendments to the PACT Act ban sending vaping products, for tobacco, cannabis or CBD through the U.S. Mail.
Beginning this spring, Fedex and UPS both announced the companies will no longer ship e-cigarettes, their component parts, or any vaping-related products.
Shipping companies must register with state attorneys general and the U.S. Bureau of Alcohol Tobacco and Firearms, and guarantee that anyone receiving products is over age 21, among other new rules and restrictions.
“These big shipping companies are saying ‘we’re out.’ From a regulatory perspective, it’s just too much,” she added.
Marty Phipps, CEO of Virginia-based Old Dominion Hemp, said a sample shipment of animal bedding hemp stalk product from Walden, Colo., was rejected by multiple carriers who told his third-party shipping vendor they do not transport hemp products.
“Myself and materials provider are having the darndest time trying to get this done,” Phipps told Let’s Talk Hemp this week. “Our material is prepackaged, pre-processed, on pallets with no smell,” Phipps said.
The shipping headaches are the latest challenge for Old Dominion, which had to change banks after Bank of America froze the company’s bank accounts earlier this month.
FedEx formerly announced in 2020 that the company would ship CBD products, but not any part of hemp raw plants, including hemp stalks.
But Phipps said he had successfully shipped hemp animal bedding through FedEx and other shippers like Southeastern Freight Lines in recent months. Southeastern Freight Lines did not return a request for comment by press time.
Those companies both rejected Old Dominion’s shipments this month, Phipps said. His third-party shipping vendor said individual carriers were making decisions to reject hemp shipments.
“Something had to happen for these companies to say ‘we don’t even want to touch it,’” Phipps said. “There’s no way I’m the only one having issues with this right now, there have to be more [companies running into shipping problems],” he added.
Attorney Golan said larger shipping companies were taking a ”closer look” at hemp shipments and trying to avoid risk by cutting back on shipping anything hemp-related.
Her firm’s hemp, cannabis and CBD clients that make vaping products are exploring more expensive private contracts for shipping products, she said.
“It’s really unfortunate. We’ll see what happens. I think the new rules are overly restrictive,” she added.
But some logistics companies have seen the new rules as opportunities, said Kevin Schultz of Elmhurst, IL,-based 357 Hemp Logistics, which ships and insures all forms of hemp, including live plants.
“Hemp still has a PR problem out there,” Schultz said. “Until the logistics is figured out, the supply chain can’t work properly.”
Ol Dominion’s Phipps said the blowback in banking, and now shipping, against industrial hemp products, legalized in the 2018 Farm Bill, was putting up roadblocks for a struggling, emerging industry, even as the legalization of THC cannabis is moving forward.
“Virginia’s governor just signed a bill to legalize cannabis. How did that happen before our state got a hemp processing plant up?” he said. “I’m gonna end up losing all my hair this year!”
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Jean Lotus is a Colorado-based award-winning journalist and hempreneur who writes about the American West and sustainable food and technologies.