The US has taken its first step to legalising hemp farming and cannabidiol (or CBD) — a key component of medical cannabis products.

The Senate passed the Hemp Farming Act of 2018 with a vote of 20 to 1.

The Act legalises industrial hemp at a federal level and officially removes it from the purview of the Controlled Substances Act.

The legislation now has to pass the House of Representatives for sign off by President Trump.

Once that is done, cannabidiol (CBD), the so-called non-psychoactive component of cannabis, will be legal in the US, says Elixinol (ASX:EXL) chief Paul Benhaim.

THC is the part of cannabis that gets you high and CBD is the part the medical fraternity, such as Zelda (ASX:ZLD), Medlabd Clinical (ASX:MDC) and Botanix (ASX:BOT), are most interested in.

This is a big deal

The implications of the US legalising one component of cannabis are huge, as Stockhead reported in April.

It means CBD products would be allowed to be exported and imported into the US.

Medical cannabis is already legal in many US States (and recreational in eight) — but moving any kind of cannabis product across State lines is impossible because the drug is federally outlawed.

That will change if President Trump ends a federal blanket ban on marijuana which conflicts with State laws.

The nation’s 326 million strong population and the sector’s rapid growth and depth in the 38 states which have legalised the drug in some form, will dwarf Canada’s cannabis market.

Researcher Grand View Research suggests medical cannabis could be worth $US55.8 billion by 2025.

The FDA approved the country’s first CBD drug this week and two Aussie companies are eyeing the US as a market for cannabis-derived drugs: Medlab and Rhinomed (ASX:RNO).

The new law

The legislation specifically legalises hemp farming.

The ASX’s only US-located hemp farmer is Elixinol Global, which listed in January with a promise to expand its hemp footprint there.

“This change, once it clears the house and is signed by the US President, will remove significant existing barriers to trade, by more widely opening up the ability for hemp growers, processors and product manufacturers to access finance, banking and insurance services without restriction, and provide better access to water rights,” the company said.

“It is also expected to enable organisations like Elixinol USA to openly advertise and market its products directly to American consumers.”