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Minnesota hemp business leaders say their industry will shutter if Congress passes a proposed deal to reopen the government.

That’s because a federal ban on hemp-derived cannabinoid products has made its way into negotiations to end the federal government shutdown. The deal introduces a cap of 0.4 milligrams of THC per container for hemp products, which local hemp producers say will decimate their businesses.

“The low-dose beverages we have might be three or four milligrams in a can. So this would be point four, right? So there's just kind of nothing there. I mean, it's kind of like drinking an NA beer,” said Omar Ansari, president of Minneapolis-based Surly Brewing Company.

He says the company has already had a client put a hold on their orders because of the congressional deal. 

“This is our livelihood,” said Ansari. “The beer business is way down. A lot of breweries, this is what they do — this keeps the doors open. So this getting banned would have a catastrophic effect on a lot of companies in Minnesota that have been following state guidelines for four years and investing money and buying equipment, hiring people, getting spaces — that all of a sudden, it’s like, whoa, whoa. The rug just got pulled out from under us.”

Minnesota legalized hemp-derived THC products in 2022 and limits hemp-derived products at 5 milligrams THC per serving and 50 milligrams per package of edibles.

Bob Galligan of the Minnesota Craft Brewers Association, which represents around 200 craft brewers in the state, estimates about 70 percent of those brewers are in the hemp market.

“We’ve been trying to advocate getting federal language that actually regulates it, not bans it. But there has been a push back and forth from different groups as to whether or not to outright ban it,” he said.

In 2018, the Farm Bill removed hemp from the controlled-substances list and defined it as a cannabis plant that has “no more than 0.3 percent of delta-9 THC.” 

This gave way for the rapid expansion of what is now a largely unregulated hemp industry on the federal level and what many call a “loophole” allowing the prevalence of intoxicating hemp products on the market. But states like Minnesota have since put guardrails on hemp.

Galligan says he’s not surprised at the attempt to ban hemp. But he wasn’t expecting it to be tacked on to the government shutdown deal.

“There’s a lot of concern, a lot of panic,” he said. “The farm bill has been up for debate and discussion now for quite some time. It was supposed to be revised the past two sessions. We've had our members reaching out to their federal offices … so this kind of came out of nowhere, and I think that is kind of the main concern.”

According to Galligan, the shutdown deal will kill Minnesota’s hemp industry and hurt consumers who prefer low-dose hemp products over traditional cannabis.

“If it passed in its current form, I would imagine an overwhelming majority of people would just stop making it. There's simply no point,” he said.

The Minnesota Office of Cannabis Management says it is monitoring the developments with Congress and reviewing proposed language for its impact on Minnesota.

“This is a complex policy issue, and we are reviewing it with the Attorney General,” said Jim Walker, the agency’s public information officer, in an emailed statement to MPR News.

This comes after Minnesota Attorney General Keith Ellison joined 38 other attorneys general last month in a letter to Congress urging for a ban on intoxicating hemp products. He later clarified he supports the state’s hemp industry, but wanted more potent products to be regulated.

“We do not want and do not support changing the status quo in Minnesota,” Ellison said on Oct. 30 after signing the letter. “So if you are part of that industry, don't worry. We're simply saying that competitors coming in with more potent products, which you're not allowed to sell, should not be allowed to do that.”

Republican Sen. Rand Paul of Kentucky, who voted no on the bill, introduced an amendment aiming to strike language that he believes unfairly targets Kentucky’s hemp industry.

But on Monday night, the Senate voted to set aside Paul’s amendment. Minnesota Sens. Amy Klobuchar and Tina Smith voted with Paul, attempting to revisit his amendment. 

Later, the Senate passed the legislation to end the shutdown without changes to the hemp language. 

The bill is now headed to the House, which could vote on the deal as early as Wednesday afternoon.

If passed, the changes impacting the hemp industry would be effective starting a year later.

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The U.S. Senate is negotiating a deal that Minnesota hemp leaders say will kill the hemp industry.

Local hemp producers stunned as deal to reopen government attacks hemp

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