New Industrial Hemp Promotion-Research Agency

Summary#

This is a proposed proclamation to create the Canadian Industrial Hemp Promotion-Research Agency (a national producer/industry agency) under the Farm Products Agencies Act. If approved, the agency would be able to set and collect a levy to fund research and marketing for the Canadian hemp sector. The proposal was published on April 20, 2024 and invites comments for 30 days after that date.

What it does#

• Establishes the Canadian Industrial Hemp Promotion-Research Agency with a nine‑member board and a head office in Calgary, Alberta.
• Gives the agency the power to fund and run promotion and research programs for industrial hemp (domestic and export markets).
• Allows the agency to develop a levies order to charge levies on:
  • interprovincial sales of primary hemp products,
  • imports of primary and processed hemp products,
  • exports (powers include export-related activity).
• Sets out that levies must be approved and overseen by the Farm Products Council of Canada (FPCC) before they can be collected.
• The industry proposal recommends an initial levy rate of 0.5% on the value of sales and imports of covered hemp products.
• Administrative details in the proposal include board election rules, a requirement to file annual budgets and business plans, and an initial plan to convert an existing voluntary checkoff into the levy.

Who's affected#

• Hemp growers and licensed cultivators across Canada — the number of licences rose from 542 in 2018 to over 900 in 2022.
• Hemp importers and buyers of primary hemp products, who are the proposed payers of the levy.
• The hemp-processing and marketing sector, including industry groups such as the Canadian Hemp Trade Alliance (CHTA), which currently collects a voluntary checkoff.
• Provinces with most production: Alberta, Saskatchewan, Manitoba (these three accounted for the majority of licences historically), though production is growing in Ontario, Quebec, and New Brunswick.
• Indigenous hemp licence holders — the proposal notes 33 Indigenous‑owned or affiliated hemp licence holders as of March 2022.
• Consumers and small businesses — the proposal says the levy would have a negligible impact on consumer prices and small-producer operations, and that levy collection would be invoiced by the agency or a third party (so no new reporting burden on producers).

Why it matters#

• Stable funding: Turning voluntary industry fees into an approved levy would create a steady funding source for research and promotion aimed at growing the hemp sector.
• Real-world effects could include more research into production and product quality, national marketing campaigns, and efforts to open or expand export markets.
• Scale and cost: The sector is still relatively small—seeded area was 55,400 acres in 2023, estimated sales were $525 million in 2022, with exports $84.2 million and imports $2.9 million—so the initial levy revenue is expected to be modest (about $200,000 initially, possibly rising to over $400,000 long term).
• Next steps and limits: This is a proposal, not law. Any levy must be approved by the Farm Products Council of Canada and published in Canada Gazette, Part II before it takes effect.