States, courts grapple with illegal hemp as they await new federal rules

Negotiations are underway on the 2024 Farm Bill, but intoxicating hemp products are already readily available.

While U.S. federal rescheduling talks dominate headlines lately, questions regarding its chemical cousins have also been taken to task across every level of government.

In Minnesota, regulators seized approximately $278,000 worth of raw cannabis flower from hemp stores selling intoxicating products, according to the MinnPost. The state recently created a legal workaround to enforce a ban on these products, with retailers caught selling them after August 1, 2023, facing the threat of exclusion from Minnesota’s upcoming recreational marijuana market.

Minnesota’s efforts to support its adult-use program come as state courts, lawmakers, and businesses alike continue to wrestle with the legality of intoxicating hemp products in their own ways. The proliferation of these products are the result of companies exploiting a loophole in the 2018 Farm Bill, which legalized hemp containing less than 0.3% delta-9 THC.

Squabbles hold up 2024 Farm Bill

At the federal level, Congress is considering stricter regulations on hemp-derived cannabinoids as part of the 2023 Farm Bill, which has faced delays in D.C. over non-cannabis disagreements, such as funding for the Supplemental Nutrition Assistance Program SNAP, commodity support programs, and  conservation program funding, as well as numerous proposed amendments and much political maneuvering.

One version of the bill recently underwent an hours-long mark-up process. The House Agriculture Committee approved an amendment to generally ban intoxicating cannabinoids like delta-8 THC, though some fear it could unintentionally criminalize many CBD products.

U.S. Hemp Roundtable General Counsel Jonathan Miller, who lobbied members of Congress before the hearing to vote against the amendment, said the measure would result in the “federal prohibition of 90-95% of all hemp products on the market” and “wreak havoc in the fiber and grain markets.”

Complicating matters further, prices for hemp-derived THCA flower have already converged with those of state-regulated marijuana, according to Hemp Benchmarks data reported by Green Market Report, making the products an attractive substitute for consumers and undercutting legal marijuana markets. And thanks to delta-8 and THCA, many are trying cannabis for the first time via intoxicating hemp, with preferences ultimately shaping medical cannabis channels.

Tackling intoxicating hemp

The debate over hemp-derived intoxicants is playing out in other arenas as well. The Drug Enforcement Administration recently ruled that THCA, a precursor to the psychoactive compound delta-9 THC, is not considered hemp under federal law.

In a May 13 letter recently obtained by Marijuana Moment, DEA Chief of Drug and Chemical Evaluation Terrence Boos wrote that “cannabis-derived THCA does not meet the definition of hemp” because “the delta-9 THC level must account for any delta-9 THCA in a substance.”

In Florida, Gov. Ron DeSantis plans to veto a bill banning products like delta-8 THC, a move that could boost the hemp industry while undercutting a recreational legalization ballot initiative he opposes.

Meanwhile, the California Department of Public Health took the step of warning the public that Jones Soda Co.’s hemp-infused drinks are “unsafe” and contain illegal THC additives.

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Adam Jackson

Adam Jackson writes about the cannabis industry for the Green Market Report. He previously covered the Missouri Statehouse for the Columbia Missourian and has written for the Missouri Independent. He most recently covered retail, restaurants and other consumer companies for Bloomberg Business News. You can find him on Twitter at @adam_sjackson and email him at adam.jackson@crain.com.


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