The Senate passed legislation Thursday legalizing hemp as an agricultural commodity as part of an $867 billion Farm Bill.
The provision was included in a wide-ranging agriculture and food policy legislation passed by the Senate by a vote of 86-11.
Hemp will be removed from the federal list of controlled substances and the cultivation, processing and sale of industrial hemp will be legalized as part of the legislation.
It also will allow researchers to apply for grants from the Agriculture Department and make hemp farmers eligible for crop insurance.
Senate Republican leader Mitch McConnell of Kentucky praised the passage of the bill.
"I have heard from many Kentucky farmers who agree it's time to remove the federal hurdles and give our state the opportunity to seize its full potential and once again become the national leader for hemp production. That is why I strongly advocated for this measure to be included in the Farm Bill," McConnell said.
The Senate Farm Bill also lowered the adjusted gross income threshold at which farmers are no longer eligible for farm subsidies from $900,000 to $700,000.
It included fewer restrictions on Supplemental Nutrition Program -- food stamp -- benefits than the version of the bill passed in the House last week.
The House bill cut benefits by $9 billion over the next decade and strengthens the work requirements for those seeking the benefit.
The two bills will have to be reconciled before being sent to President Donald Trump for his approval.