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A looming federal policy could decimate the multibillion-dollar hemp industry. Hemp comes from the same plant species as cannabis, but it contains far less THC, the intoxicating ingredient that causes a high. It is not used in the theme music BJ Leiderman composes for our program. But a federal ban on hemp-derived THC drinks and gummies is set to take effect at year's end, and that could upend a booming market, which prompts some farmers to plant different crops this year. Nicole Ki from member station Minnesota Public Radio reports.
JEREMY SAUERESSIG: So what you see here is soybeans. What we've got normally is a rotation of corn or hemp.
NICOLE KI, BYLINE: For the first time since 2019, Jeremy Saueressig is not growing hemp at his Minnesota farm. Instead, he planted more soybeans. While new state licensing rules factored into his decision, the bigger problem is uncertainty over a federal ban on hemp THC products.
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.
KI: Many popular hemp edibles and beverages contain THC, ranging from 2 to 10 or more milligrams. In December, a new federal limit will cap potency at just four-tenths of a milligram, threatening products sold in at least 20 states where hemp-derived THC is legal. The change was part of a federal spending bill last year and was aimed at closing what some lawmakers called a hemp loophole. The rules were set to take effect in November but were pushed back another month to give Congress more time to find a long-term solution. Looking at his 200 acres of soybeans, Saueressig sees something else.
SAUERESSIG: A lost opportunity of another year of R&D, another year of moving the market.
KI: He still has about 15,000 pounds of hemp from last year that he hasn't been able to sell. The ripple effects are also reaching manufacturers.
About 30 miles from Saueressig's farm, Kyle Marinkovich walked me through the production floor at his Twin Cities facility. His company processes hemp plants into emulsions used in low-dose THC drinks and edibles.
KYLE MARINKOVICH: This is the emulsion lab and then, also, gummies.
KI: Normally workers would be busy extracting compounds from giant sacks of hemp. But these days, it's quiet. Marinkovich works with six Minnesota growers, including Saueressig. None planted hemp this year.
MARINKOVICH: They're not going to grow something that they don't believe they can sell.
KI: He says sales have flattened this year as retailers and distributors order less. And if the ban takes effect, it could shutter his business.
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.
KI: More than five bills have been introduced in Congress to save the hemp industry, including one from Senators Amy Klobuchar and Rand Paul that would let states regulate hemp. They've been referred to committees in the House and Senate, but so far, none has come to a vote.
Back at Saueressig's farm in Minnesota, the hope is to plant hemp again next year. Despite this year's challenges, he's optimistic.
SAUERESSIG: But I do see a future for it. I really do.
KI: But for now, his fields are growing soybeans.
For NPR News, I'm Nicole Ki in Minneapolis-St. Paul.
(SOUNDBITE OF MF DOOM SONG, "SMOKIN' THAT SHIT!") Transcript provided by NPR, Copyright NPR.
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