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Stacy McCaskill began growing hemp in 2019, shortly after Congress included the long-prohibited plant in the farm bill.
Now her business Hempstock Pharms in northern Illinois sells more than 150 hemp products.
“We do everything that’s hemp-derived and that’s legal compliant, from smokeables, topicals, tinctures, edibles, drinkables,” McCaskill said. “We’re in every single category of cannabinoid consumption.”
But a new federal ban on hemp products set to go into effect on Dec. 11 would force her to stop selling most of her inventory.
“This is devastating what’s happening,” McCaskill said. “We're really busy right now trying to figure out our end of game. Like, how do we wind this all down? How do we make a pivot into the products that are not cannabinoids or can be compliant products?”
Right now, she said the products that would fit the new regulations make up less than 10% of her business.
The 2018 Farm Bill established the framework for a legal hemp market. It defined hemp as cannabis plants below a certain threshold of THC, which is the psychoactive part of cannabis, and removed it from the Controlled Substances Act.
This opened what many call a loophole in federal law that established a new industry of cannabinoid products. Companies are able to extract enough THC or synthetically create it from the legal hemp plants to make products with similar effects to highly-regulated marijuana. There are also CBD products, which are non-intoxicating and commonly used in therapies.
Then, last November, Congress passed a measure that limits what’s considered legal hemp. The new rules ban products that contain more than 0.4 milligrams of THC and products that contain cannabinoids that are manufactured in a lab or aren’t naturally produced by the cannabis plant.
The ban is meant to curb unregulated sales of intoxicating hemp products, according to a Senate Appropriations Committee memo.
But business owners and advocates in the hemp industry say the ban would affect nearly everything that's currently on the market.
“Even the vast majority of non-intoxicating CBD products have more than 0.4 milligrams of THC per container,” said Jonathan Miller, the general counsel for the advocacy group U.S. Hemp Roundtable.
Miller said the federal ban would be a “death blow” to the U.S. hemp industry.
“We’re talking about a $23 billion industry with about half a million jobs in agriculture and retail sectors,” Miller said. “And 95% of that would be wiped out.”
The ban was supposed to start in November, but Congress recently delayed the start date by one month. Miller said the extra time means lawmakers could add a different hemp framework into a government spending bill due in December.
He said his organization and others across the country have been meeting with legislators and White House officials to discuss regulations that address concerns in the industry while protecting other products.
“The legislation language is still being worked on, but we’re fairly confident that we’ll be able to have something that will be very politically viable in time for the December deadline,” Miller said.
Cynthia Cabrera, a board member with the Texas Hemp Business Council, has also been talking with legislators.
“Basically it’s been making the case that as long as we’re all pushing for a safe consumer product, there’s no reason to go back to prohibition,” she said.
Cabrera said most lawmakers are focused on the upcoming elections right now, and that means there’s unlikely to be any movement until November.
Businesses prepare to shutter
Meanwhile, hemp sellers are bracing for the major rule shift.
Erin Kelly owns Kelly’s Greens near Milwaukee, Wisconsin. She sells hemp-infused treats, such as cookies, popsicles and craft drinks.
The ban will put her completely out of business, she said.
“All the products that we sell are currently legal and farm bill compliant,” Kelly said. “But with the new limits that would be put out there would decimate the limit and destroy our entire business.”
Kelly said she’s been focused on contacting Wisconsin lawmakers to advocate for the future of the state’s hemp industry.
“It’s so sad and unfortunate to see the federal government take this industry from the small business and independent shop owners that have created it,” Kelly said. “Because that’s what hemp is: it’s the working class cannabis.”
Cabrera said she expects a lot of businesses will have to shut down.
“You can’t sell nails and hammers, for example, to a customer base, and then pivot to cotton balls and expect to have the same customers,” she said. “It’s just not going to happen.”
McCaskill in Illinois is trying to pivot to other options – and she said it’s been an emotional process. For now, she’s not completely certain what the future of her business looks like.
She’s testing a hemp-leaf juice that would meet the new standards and a new line of mushroom gummies. She’s also looking into Illinois’ updated hemp license program – but it costs thousands of dollars, and she’s not certain there will even be a market for the products.
“I don't know if it'll be as effective as our current formula, you know?” she said. “So that's a lot to risk.”
This story was produced in partnership with Harvest Public Media, a collaboration of public media newsrooms in the Midwest and Great Plains. It reports on food systems, agriculture and rural issues.
