At Nothing But Hemp’s Northeast Minneapolis facility, mountains of sugar-coated candies sit waiting to be hand packaged.
The facility produces about 60,000 hemp-derived THC gummies each day. Before they are sold in state, they must be tested for potency and toxins, then packaged to meet state rules prohibiting “cartoon-like characteristics” or other imagery that markets to kids.
Co-owner Logan Fleischman has state inspectors’ numbers saved in his phone. He said he wants to be available to them, as a business behind the products they are regulating.
“I’m like, ‘You see our product, you’ve got an issue? Call me,’” he said.
Related: Minnesota’s hemp THC beverage and edible industry reels from provision to outlaw products in shutdown bill
By November next year, essentially all those products will be illegal. That’s because Congress’s vote to ban most hemp-derived THC by November 2026 will supersede all state rules, even states like Minnesota where regulations already exist.
Federal lawmakers who backed the national ban cited the need to close a loophole in the 2018 farm bill that allowed for the explosion of an unregulated market. After that change, the hemp industry found ways to extract the intoxicating THC molecule from hemp – then put it into gummies, drinks and other products that have effects nearly mirroring marijuana.
In October, 39 state attorneys generals sent a letter to Congress criticizing hemp THC manufacturers for creating “Frankenstein” products that are being sold to kids.
“These products are being manufactured and sold without consistent age restrictions, labeling standards, or safety requirements,” reads the letter, which argued for their ban.
Some states have outlawed hemp-derived THC products entirely, citing safety issues and a lack of data.
Advocates for the hemp-derived THC industry argue the problem lies with a lack of national regulations.
As response to the national ban grows, Minnesota has emerged as a state that hemp industry advocates say is a model for potential national regulations.
“It does precisely what we as an industry have been calling for, which is robust regulation,” Jonathan Miller, general counsel for the U.S. Hemp Roundtable, said in an interview about Minnesota’s regulations.
Miller said he’s testified before Congress three times since 2018 to ask the U.S. Food and Drug Administration to regulate hemp-derived THC products. It’s never happened.
“(It’s) really rare for an industry to go to Congress and ask to be regulated,” he said. “But it’s that important to the future.”
Minnesota’s regulations require hemp THC lab tests, no marketing to kids
Minnesota’s regulations on hemp-derived THC take aim at some of the biggest issues shaping the national conversation: age limits, potency, testing, labeling and packaging.
Compared with a state that has no regulations, that can make a big difference.
For example, Minnesota allows 5mg of THC per hemp-derived edible. That’s enough to get someone high.
In other states, gummies can contain 50mg or 100mg — a far higher dose than most people would want, with a potential to make someone feel head-spinningly sick.
“The lack of regulation has empowered bad actors to put out bad products, which hurts good actors. It’s hard to compete with products that are manufactured poorly, and market to kids, and the like,” said Miller, the national lobbyist.
Products must also be lab-tested to ensure they contain no more than “trace amounts” of mold, manufacturing solvents or catalysts, pesticides, fertilizers or heavy metals. Another test must prove that the dosage on the packaging, like 5mg per gummy, actually matches the product.
Related: Cities test limits of Minnesota cannabis law, exposing legal gray areas
Why? Because as the hemp THC market expands, so does the list of variants like Delta-8, Delta-10, THCA, THC-O, THC-P and others. And the manufacturing processes behind some products have raised serious safety concerns.
For example, Delta-8 THC is often created by chemically converting the CBD cannabinoid using acid as a catalyst. THC-O is created using chemicals like acetic anhydride. A U.S. Cannabis Council study found copper, chromium, nickel, methanol and other contaminants in Delta-8 products.
“How people are doing these conversions is a really big issue,” said Steven Brown, CEO of Nothing But Hemp. “We had a board meeting one day, and were like, ‘OK, let’s go all natural.’”
The company uses only hemp-derived Delta-9 THC, which naturally occurs in hemp (in low amounts) as well as in marijuana. It’s extracted using carbon dioxide, or CO2, a process that research has shown to be safe.
Minnesota is phasing out everything but hemp-derived Delta-9. It’s never allowed for the sale of hemp-derived THC vape pens, which have raised unique safety concerns.
“Based on what we’ve seen, what we’ve heard, the sort of early research returns
— we felt most comfortable saying that Delta-9, artificially derived from hemp, is usable, is acceptable,” said Eric Taubel, executive director of the state’s Office of Cannabis Management.
“But a lot of these other ones, there’s just a lot of concerns about what the impact and effects might be,” he said.
Minnesota Attorney General Keith Ellison was among the initial 39 signatories of the letter to congress that criticized the hemp-derived THC industry.
But he later walked that back, saying Minnesota has created a “robust regulatory framework.”
“Adopting the Minnesota model will put bad actors out of business, protect consumers, support members of industry who play by the rules, and preserve access to the low-potency hemp products that many people have come to enjoy,” Ellison said in a Nov. 14 statement.
So, is it working? Minnesota’s regulatory system is still new
In many ways, Minnesota is still playing catch-up to regulate a national industry that was born without any rules.
It was only 2022 when Minnesota lawmakers passed the state’s first regulations on the sale of hemp-derived THC. Taubel, the cannabis management office director, said that legislation created a “bare bones regulatory framework” that lawmakers expanded on in 2023.
“I think what makes Minnesota unique is that it was one of the first states to recognize where the intoxicating hemp market was going after the 2018 farm bill,” Taubel said.
Lawmakers in the 2023 session also legalized recreational cannabis and established the Office of Cannabis Management.
Taubel said the cannabis agency has about 100 staff, more than 60 of whom are dedicated to enforcement. Their duties are not split between regulations on hemp or marijuana (which are actually two variants of the same plant species: Cannabis sativa).
Currently, that office is processing over 2,000 licenses related to hemp-derived products. In the past, businesses needed only register with the state.
It’s also getting ready for the Jan. 1, 2026, deadline when hemp-derived THC products will need to be tested only through a state-licensed laboratory. That could be a problem, given there are only two state-licensed labs currently operating.
A third testing site will be ready soon, Taubel said.
Data produced by the state agency suggest compliance is improving with state regulations, but it’s not perfect.
Between January and October 2024, Minnesota conducted 2,388 inspections of businesses selling hemp-derived cannabis. In the first quarter, 35% were compliant with state requirements. By the third quarter that figure had reached 70%, according to the Office of Cannabis Management’s 2025 report to the state Legislature.
Enforcement officials can seize and destroy products that don’t comply with state rules. They might have more than double the legal THC limit or contain prohibited synthetic cannabinoids, among other regulatory issues.
Nearly 32,000 products, for a retail value of about $838,600, were found noncompliant between Jan. 1 and Nov. 30, 2024, according to the state report.
“The approach we’ve always taken is, sort of, ‘educate the compliance,’ with a sort of fundamental belief that most people that are in business want to do so correctly, legally and in accordance with all required regulations,” Taubel said.
Regardless of those state safeguards, the products have still never been vetted by the FDA.
That puts them at odds with things like pharmaceuticals and food.
Americans often assume that if something is sold in the store, it’s safe, said Colin Planalp, senior research fellow at the University of Minnesota’s Office of Cannabis Research.
That research center doesn’t have a position for, or against, cannabis. The goal is to ensure people have information needed to make informed decisions, he said.
“Not everything being sold in stores is regulated the same way, and to the same extent, and I think it’s important for people to understand that,” he said.
What’s next?
On Monday, several Minnesota elected officials stood side-by-side with hemp industry advocates as they called attention to the state’s regulatory model. Included were Democratic U.S. Sens. Amy Klobuchar and Tina Smith, Rep. Ilhan Omar, Minneapolis Mayor Jacob Frey, state Sen. Lindsey Port, and others.
Minnesota breweries that also sell THC beverages explained how the federal ban would kill thousands of jobs, millions in lost state tax revenue, and investments into an industry that’s helped save otherwise struggling breweries.
“The industry has looked at that vote (in Congress) as a vote to reopen the government, not a vote against hemp,” said Ryan Kopperud, vice president of growth at Wild State Cider in Duluth.
Technically, the ban doesn’t go into effect for a year. What happens in the interim is anyone’s guess, but it could certainly include maintaining the ban or modifying it to include regulations.
“We’re at a profound moment of uncertainty in the state of Minnesota, especially, as to what is going to happen with our hemp-derived THC products market,” said Planalp, the researcher. “I don’t think that anyone can tell you with certainty what is going to happen.”
What’s clear is there are more considerations than just which regulations might, or might not work best.
For one, the hemp-derived industry is already worth billions of dollars. Thousands of retailers, just in Minnesota, sell the products. Farmers, manufacturers and other business owners have invested into their success.
There’s also a complicated economic and political landscape at work.
One reason is because hemp-derived THC is competing with recreational marijuana, which is legal in 24 states including Minnesota.
It’s also competing with alcohol sales, as breweries and liquor stores increasingly stock THC products.
“I’ve got friends who haven’t had a drink (of alcohol) in 25 years, who drink this stuff all the time,” said Paul Kaspszak, executive director of the Minnesota Municipal Beverage Association, in an interview.
THC is where the growth is, Kaspszak said.
“This is just like prohibition all over again. Everybody’s still trying to figure out how to regulate this product. The Minnesota system is very well defined. You go to other states, and they’re not,” he said.
Insight Brewing Company alone sold 43,560 cases of THC beverages across the Twin Cities metro in 2024, said co-owner Kevin Hilliard during the Monday press conference.
As someone who’s only “one generation off the farm,” Hilliard said hemp plants will go into the ground this year around Mother’s Day.
“If a farmer has uncertainty, they’re not going to plant,” he said. “So when we look around and say, ‘Hey, we’ve got a year,’ I don’t want you to think that way. I want you to think we have a couple of months.”
The U.S. Hemp Roundtable, the national lobbying group, has vowed to help introduce bills in congress to regulate the industry.
Brown, the Nothing But Hemp CEO, said “we’re just not getting any answers” from the FDA as to why the industry has not been regulated.
He said on the federal side, “we can save this.”
But he believes that will only happen if different factions of the hemp industry come together with a united voice.
“If we don’t, we’re gonna lose,” he said.
The post As hemp THC industry lobbies Congress for regulations, could Minnesota be a national model? appeared first on MinnPost.
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