Federal Ban on Hemp-Derived THC Products Threatens Industry’s Future
The hemp industry is on the brink of a significant transformation as a federal ban on hemp-derived THC products looms, potentially disrupting a thriving market for low-dose beverages. Scheduled to take effect by the end of the year, this policy change could impact farmers and businesses significantly.
A federal policy set to be implemented could severely impact the multibillion-dollar hemp sector. Unlike cannabis, hemp contains minimal THC, the psychoactive component responsible for producing a high. However, a ban on hemp-derived THC drinks and gummies might soon be enacted, a move expected to reshape the industry landscape. Farmers are already reconsidering their crop choices as a response. Nicole Ki from Minnesota Public Radio sheds light on the situation.
Jeremy Saueressig, a Minnesota farmer, has opted to grow soybeans instead of hemp for the first time since 2019. While new state licensing requirements influenced his decision, the uncertainty surrounding the federal ban on hemp THC products is a more pressing concern.
JEREMY SAUERESSIG: “We’ve done hemp here on this field the last three out of seven years. This year, though, the market has been affected federally. The demand isn’t there. The processors are a little hesitant to contract or buy anything, so we’re taking a year off this year.”
Hemp edibles and beverages, often containing THC levels between 2 to 10 milligrams, face impending restrictions. A federal limit, capping potency at a mere four-tenths of a milligram, is set to be enforced in December. This policy, originating from a federal spending bill, aims to address what lawmakers identified as a “hemp loophole.” Although initially planned for November, the rules were delayed to provide Congress additional time to devise a long-term solution.
Looking over his 200 acres of soybeans, Saueressig perceives missed chances.
SAUERESSIG: “A lost opportunity of another year of R&D, another year of moving the market.”
He still has 15,000 pounds of unsold hemp from the previous year. The repercussions are felt by manufacturers as well.
About 30 miles from Saueressig’s farm, Kyle Marinkovich oversees operations at his Twin Cities facility, where hemp is processed into emulsions for low-dose THC products.
KYLE MARINKOVICH: “This is the emulsion lab and then, also, gummies.”
Typically bustling with activity, the production floor is now quiet. Marinkovich collaborates with six Minnesota farmers, including Saueressig, none of whom have planted hemp this year.
MARINKOVICH: “They’re not going to grow something that they don’t believe they can sell.”
Sales have stagnated as retailers and distributors reduce orders. If the ban is enacted, Marinkovich’s business faces possible downsizing or closure.
MARINKOVICH: “We would be, at best, a much smaller operation. Unless some of our other products could pick up the slack, we’d probably have to shut down. Yeah. It’s dire.”
In Congress, more than five bills aim to protect the hemp industry. Notable among them is legislation from Senators Amy Klobuchar and Rand Paul, proposing state-level regulation of hemp. These bills are currently in House and Senate committees but have yet to reach a vote.
While Saueressig remains hopeful for the return of hemp cultivation next year, his fields are currently dedicated to soybeans.
SAUERESSIG: “But I do see a future for it. I really do.”
For NPR News, I’m Nicole Ki in Minneapolis-St. Paul.
(SOUNDBITE OF MF DOOM SONG, “SMOKIN’ THAT SHIT!”)
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