Brewing blow: Minnesota's $200M hemp industry faces federal ban

Government shutdown deal will end MN hemp industry

The deal that ended the government shutdown will end the Minnesota hemp industry in one year. FOX 9's Corin Hoggard has the story.

MINNEAPOLIS (FOX 9) - Minnesota's hemp industry faces a potential crisis with a new federal law threatening to make intoxicating hemp products illegal.

Impact on local businesses

What we know:

THC beverages have become a significant part of the business for Minnesota breweries like Utepils Brewing in Minneapolis. 

Dan Justesen from Utepils noted that these beverages account for more than 15% of their business. Similarly, Jon Halper, CEO of Top 10 Liquors, said that THC drinks make up almost 15% of their overall sales.

Minnesota's $200M hemp industry faces federal ban

Minnesota's hemp industry faces a potential crisis with a new federal law threatening to make intoxicating hemp products illegal. FOX 9's Corin Hoggard has the story.

Many Minnesota brewers have invested heavily in the production of THC beverages, with Utepils even purchasing faster canning machinery this year. Hundreds of businesses have applied for hemp business licenses in the state.

What they're saying:

"We've seen significant volume drops in beer being sold to the hospitality industry, bars, restaurants and we're also seeing drops in sales to off-premise liquor stores," said Justesen. 

Halper added, "It's become almost 15% of our overall sales. So it's becoming a tremendous amount of what we do."

Potential future for THC products

The backstory:

If the federal law takes effect, cannabis products could still be sold in states with legalized marijuana, but only by licensed cannabis retailers. This means they would not be available at liquor stores or through traditional banking systems, effectively ending the sale of hemp-derived products.

Halper expressed concern, stating, "This is a ban at this point, and if we can't get the government to enact law to allow the category to exist, it won't exist a year from now. So it is a real threat."

What's next:

The industry is advocating for a new law with regulations to address safety concerns raised by lawmakers. However, there is uncertainty about whether the business will survive the next year.

What we don't know:

It remains unclear if the government will enact a law to allow the category to exist, or if the industry will find a way to adapt to the changes.