Politics
Congress Is Unlikely To Prevent A New Federal Ban On Hemp THC Products This Year, Top Marijuana Reform Group Says
“There may be some fiddling around the edges with THC limits and maybe with beverages.”
By Phillip Smith, The American Hemp Monitor
Congress is unlikely to do anything to undo the hemp ban it passed last year, and that will have devastating consequences for the hemp cannabinoid industry, leaders of the Marijuana Policy Project (MPP) said in a Wednesday Zoom call.
Hemp—defined as cannabis containing less than 0.3 percent THC by dry weight—was legalized by Congress in 2018, but under legislation last fall, new, more restrictive definitions effectively criminalizing many hemp-derived cannabinoid products will go into effect in November unless Congress acts to delay or amend them.
The new language counts not just delta-9 THC (what people generally mean when they refer to THC), but also delta-8 THC and THCA when measuring for that 0.3 percent threshold. It also limits consumer products to 0.4 milligrams of total THC per container and bans synthetic and converted cannabinoids.
“Sen. Mitch McConnell (R-KY) thought the hemp industry was out of control, and he could point to bad actors, sales to children, flashy packaging, things like that, to close the hemp loophole,” said MPP State Policies Director Karen O’Keefe. “He used the reopening of the federal government after last fall’s shutdown to rein in hemp, but instead of replacing the regulatory void that had existed since 2018 with a sensible regulatory structure, Congress effectively banned most hemp products starting in November.”
That’s not likely to change between now and then, said MPP Executive Director Adam Smith.
“We are unlikely to see further moves from the federal government on the cannabis front under this Congress,” Smith said. “Since Congress passed that ban on all hemp-derived products with more than a trace of THC, there has been a lot of work to try to delay or replace that ban. Rep. Andy Barr (R-KY) is about to introduce a hemp regulation bill, but we don’t see that happening,” he said.
“There may be some fiddling around the edges with THC limits and maybe with beverages,” Smith continued. “The administration is pushing to allow a bit more THC, to bring in full-spectrum products,” Smith said, pointing to Howard Kessler as the administration figure leading the charge. “But I don’t see the administration pushing beyond that.”
Kessler is a wealthy businessman and Trump friend who has advocated for years for medical marijuana and CBD and successfully pushed Trump to issue the executive order that will move marijuana from Schedule I to Schedule III of the Controlled Substances Act.
Smith, O’Keefe, and MPP Southeast Legislative Manager Kevin Caldwell all shared a gloomy outlook on the consequences of the hemp ban taking effect.
“It will be a financial disaster for companies built around selling THC products from hemp,” said Smith. “Unless Congress acts, they will go away entirely.”
“Companies will have to shut down completely, shift to other products or work under federal illegality,” like marijuana companies in legal states, said O’Keefe. “And that means problems with banking, and cannabis employees can be permanently inadmissible if not U.S. citizens. Even if some states choose to continue to allow this, we would need to see a dramatic restructuring of how the industry operates.”
“If the ban goes into effect, I think we will see a huge drop in both tax revenue and access for consumers, and a very large increase in the number of Americans arrested again. Those products will be considered marijuana. They will become illegal, with harsh penalties in some states,” said Caldwell. “One thing we’ve seen with hemp is a reduction in cannabis arrests in prohibition states. In many states, including Florida, North Carolina and Texas, the number of arrests declined either because consumers were purchasing hemp products or because crime labs lacked the bandwidth to test them all.
The new cannabinoid thresholds are so low they will wipe out whole product lines, said O’Keefe.
“That 0.4 milligram limit per container—and it’s total THC, not just delta-9 THC—is a very small amount. There are a lot of products, even including nonintoxicating ones, such as topicals or full-spectrum CBD products, that will have more than 0.4 milligrams of THC,” O’Keefe noted. “And it also bans synthetic cannabinoids.”
That may not be such a bad thing, said Smith.
“While this is a complicated issue, we don’t think it’s a bad thing to ban synthetics,” he said. “No one really knows the impact of consuming those molecules. And we don’t think having a totally unregulated hemp cannabinoid industry was an unalloyed good. We shouldn’t be putting stuff out into the world when we don’t know its effects, and we don’t want to sell unregulated products for human consumption.”
“What we need is an overall rational cannabinoid policy,” Smith continued. “Hopefully, we will get to the point where we can put this all under one umbrella that keeps people safe but preserves access to cannabinoids. Synthetics and delta 8 would not exist but for prohibition. A lot of these problems we’re trying to solve are created by the fact that naturally occurring cannabinoids remain illegal in many states.”
But what about the kids?
“For 30 years, we’ve heard that legalization will addict our children, but teen use is near the lowest level since the CDC started asking the question back in 1975,” Smith said. “It’s been cut almost in half, and youth access is down. It’s important to understand that the idea that we are endangering kids by regulating the market is the opposite of the truth.”
The alcohol industry is interested in the future of hemp, but different sectors have diverging and sometimes conflicting interests, said Smith.
“Alcohol distillers are against allowing THC beverages, but distributors favor them,” he said. “There is a lot of money going into this from distributors. We’ve seen a drop in alcohol use as cannabis use rises, but around beverages is where we get lobbying voices outside the cannabis realm who have long-term relationships on the Hill and the money to make things happen.”
In the meantime, people in the industry will have to hunker down.
“It’s a really difficult time for folks in this industry; everything is very chaotic, people lobbying on all sides,” said Caldwell, “but I’m certain we are not going to see a repeal of this ban, a broad opening to intoxicating products, although beverages may be a different story. The ban will go into effect relatively close to what it looks like now.”
“Hemp farmers are supposed to be putting their crops in the ground right now,” said Smith. “I’m glad I’m not a farmer in North Carolina or Tennessee trying to figure out if their product will be legal or illegal. They’re having to make very hard decisions.”
This story was first published by The American Hemp Monitor.
