In a commercial kitchen outside of Raleigh, North Carolina, Nicholas Hohns spreads blue-green goo into a checkered pan, creating one of his company’s signature products: potent THC gummies, which contain the main intoxicating compound found in marijuana. It is a business that will soon have to be abandoned. The multibillion-dollar U.S. market for harmful hemp products — from THC drinks sold in some Target stores to smokable cannabis flowers — faces possible elimination after Congress voted to close a loophole in federal law that has allowed it to flourish. Industry advocates, along with some lawmakers, are fighting to save it. The short-term government funding bill signed by President Donald Trump last month pushed back the effective date of the “hemp THC ban” from Nov. 12 to Dec. 11, giving Congress more time to consider regulating the products rather than banning them. “It’s such a strange situation,” Hohns said. “You worked 100 hours a week for the last four years and, yes, you made some money. But now you may have nothing to show for it.” Marijuana and hemp are the same plant: cannabis. Marijuana is grown for its high levels of THC in its flowers. Low-THC hemp has historically been grown for its sturdy fibers, food, or wellness products. “Rope, not dope” was long the motto of farmers who supported the legalization of hemp. To give farmers a new cash crop, Kentucky Republican Sen. Mitch McConnell successfully pushed for the legalization of industrial hemp in the 2018 farm bill. But the way that law defined hemp—with less than 0.3% by weight of a specific type of THC, called delta-9—opened a huge loophole. Drinks or snacks could meet that threshold and still contain more than enough THC to get people high. Unregulated and untested vape oil, gummies, chips, soda, and other products loaded with hemp-derived THC spread across the country, including at gas stations or convenience stores, where they were available even to teenagers. Some companies began selling marijuana under the theory that the THC in raw marijuana is in a form called THC-A, which only converts to harmful delta-9 when heated or burned. The products evaded state bans on recreational marijuana or undercut highly taxed, regulated cannabis when it was legal. Dozens of states responded by regulating or banning harmful hemp products. McConnell finally closed the loophole late last year by inserting a ban on THC from hemp in a move that ended the longest government shutdown in history. The ban, which limits the amount of THC in hemp products to 0.4 milligrams per container, would not take effect for another year. The ban “threatens to reduce retail revenue by $28.3 billion, displacing 225,000 jobs and reducing potential state sales taxes by $2.1 billion,” according to a report last month by Whitney Economics, which studies the market. The industry hopes to save itself by restricting harmful products to people over 21. limit the amount of THC that can be in a package and ban imported cannabis compounds. Kentucky Cornbread Hemp owners Eric Zipperle and Jim Higdon are prepared to limit their products to, say, 5 milligrams if that’s what it takes to win lawmakers’ support. But the 0.4 milligram limit would destroy their business, they said. “If it passes in December, this place is done, it’s gone,” Zipperle said. They have 105 employees, sell hemp beverages in 18 states, and hope to raise $65 million this year. The 0.4 milligram limit is so low that it would ban even some body-friendly CBD products, such as topical lotions, said Jonathan Miller, general counsel for the industry group US Hemp Roundtable. Hohns, who runs Deutermann Farms in Clayton, North Carolina, entered the hemp industry after losing his job as a personal trainer during the COVID-19 pandemic. North Carolina has not legalized medical or recreational marijuana, but many of the edibles Hohns makes are more potent than those available in states that have. “When I started seeing THC edibles being sold… I thought I had 18 months to two years to make money in this industry,” Hohns said. “There is no way the government is going to sit here and let us do this when it was supposed to be for fibers, plastics, construction materials and ropes.” That was more than four years ago. Hohns kept his capital investments to a minimum for fear of closure. It has considered making other products, such as creatine gummies, if it has to get out of the hemp THC business. Things have been more stressful for others. Drinkin’ Buds, a cannabis beverage company in Sheboygan, Wisconsin, has suspended production. Co-founder Matt Swanson left the payroll on Thursday. “There’s so much uncertainty,” Swanson said. “I am actively looking for a job.” Among those who have come to the hemp industry’s defense are alcohol retailers, including Total Wine & More. Sales of cannabis seltzers have helped offset the decline in alcohol sales. Opponents include people who say the products are dangerous. “I feel sympathy for the people who are losing their jobs, but also for the many, many more people whose lives are affected by this,” said Kevin Sabet, executive director of Smart Approaches to Marijuana. The legal regulated marijuana industry, which views hemp THC as unfair competition, also supports prohibition. Cory Harris, a lobbyist for state-legal cannabis operators, suggested that dire predictions about its effect on the intoxicating hemp industry are exaggerated. While the ban would end interstate sales of products like seltzers and THC gummies, some could find a home in the state’s legal markets, he said. THC-infused drinks may be sold in stores in the states where they were produced. States like North Carolina could adopt legal hemp programs. “If you go from having virtually no rules to suddenly having a ton of rules, that’s silly,” Harris said. “Welcome to our world. But if you set up your entire business within a legally questionable loophole, that’s simply the risk you take.” ___ Associated Press reporters Allen G. Breed in Clayton, North Carolina, and Dylan Lovan in Louisville, Kentucky, contributed.
