Scottish hemp industry flags Brexit and COVID-19 challenges amid regulatory debate

26 Jan 2021 --- Brexit has exacerbated uncertainty around Scotland’s hemp and CBD market, which could have major knock-on effects. Kyle Esplin, chair of the Scottish Hemp Association, speaks to NutritionInsight about how industry can bounce back and the regulatory considerations surrounding whole plant hemp extracts and novel foods.

“Brexit means further uncertainty, and that’s not good for business. Many companies source their raw materials from Europe, favoring quicker, smoother imports than from non-EU countries, which has all changed now,” he explains.

Notably, some suppliers have put a temporary hold on shipping into the UK for fear of extra delays or losses with the new paperwork. Before Brexit, many companies had negative experiences importing from the US, with customs sometimes holding up hemp products for several months before being released. 

“There is concern the same could happen for goods coming in from the EU now, and we’ll find out in time.”

Not just for cosmetics
The UK’s departure from the EU has also created a whole new regulatory environment. The Scottish Hemp Association argues that purified isolated CBD and synthetic CBD should be treated as a novel food but that products made from whole plant extracts be allowed to remain on the market as they have been for the last few years.

“From experience across Europe, novel foods enforcement has seen a shift toward whole plant extracts remaining on the market as registered cosmetics, labeled for external use only,” says Esplin. 

He does not believe this is a good outcome for consumers. “The novel foods process is set up to favor purified isolated or synthetic CBD. Many consumers use whole plant hemp extracts rich in CBD and avoid CBD isolates.”

Esplin says that ideally, the market would continue as it has done for the last few years, but with CBD isolates and synthetically produced CBD being a novel food, and whole plant extracts exempt. 

“Hemp seed oil has been on supermarket shelves since the late 90’s and often contains more total THC in a bottle than the CBD products analyzed by the FSA and FSS. Hemp seed oil can also contain up to 2,000 mg CBD per liter in certain varieties, the CBD and THC content get no mention on the label, so it’s not about the safety concern of CBD itself, or trace THC.”The Scottish Hemp Association is calling for whole plant hemp extracts to not be treated as a novel food.

A different path for Scotland?
The Scottish Hemp Association was initially hoping that Food Safety Scotland (FSS) would use its independent authority and take a different path from the Food Standards Authority (FSA). 

Following seven months of meetings with the Scottish Hemp Association, the novel foods policy now looks like it will be fairly consistent across the UK with FSS following the FSA. 

“It had come to our attention that the FSA deadline of March 31, 2021 for novel foods applications only applied to England and Wales. Our priority as an association was to propose a compromise with FSS on the proposed novel foods plan,” explains Esplin. 

A long-standing interest 
While CBD isolates are starting to dominate in the supply chain, Esplin says that five years ago, whole plant hemp extracts were popular. 

“Plant hemp extracts are what drove the popularity of the market initially. As large companies entered the space, it appeared CBD isolate would have more market opportunities and distribution chains worldwide, which caused an over-investment into the production of CBD isolate.”

He explains that compounded by the current pandemic, the oversupply of CBD isolate has crashed in value while whole plant hemp extract has remained fairly stable. 

“Overall, we see sales continue to grow, with consumers becoming savvier in their choice of supplier and how a product is made.”

The UK takes over risk analysis
As of January 1, 2021, the UK took over risk analysis for regulated products. However, Esplin notes that there is still a lot of uncertainty around the process.

“Many companies are not happy about how it is affecting the hemp market. It is opening the door to synthetically produced CBD with no labeling requirement to state that a product is synthetic.”

It’s unclear if it will be possible to get a real full spectrum extract through the process. The potential for variables in a whole plant extract compared to isolated CBD means most companies are only applying with isolate or synthetic, he explains. 

“The issues of trace amounts of THC found have been greatly overblown in the media. The average THC levels reported in CBD products across the UK have been shown to be less than the total often found in a bottle of hemp seed oil.”The hemp and CBD industry has always been driven by the consumer in a grassroots way, says Esplin.

Looking to the future
Despite the turmoil of recent months, there is still light on the horizon. The Scottish Hemp Association is eagerly anticipating the production of non-novel, CBD-rich hemp oil from Scottish grown hemp for the first time.

“While we look forward to new CBD-rich hemp varieties from the US and Canada being added to the European catalog, there is also the concern of synthetically produced CBD starting to dominate the market as its production cost drops.” 

The association sees that as detrimental to farmers and consumers, which will be a direct consequence of not separating plant-based CBD from synthetically produced CBD in the novel foods process. 

“We are starting an awareness campaign in the UK around this issue in a bid to convince food regulators to insist labels state when a product contains synthetically produced CBD and not plant-based,” concludes Esplin. 

However, many experts in this space note that synthetic cannabinoids or cannabinoid-inspired molecules can offer advantages both at a production and retail level.

By Katherine Durrell