MJBiz - March/April 2024 - 38

Marijuana
Masquerade
Fingers Crossed
H
Producers of intoxicating hemp-derived products are wary
of changes a new U.S. Farm Bill could bring to market
By Chris Roberts
emp drinks are big business
in the United States and
poised to grow even bigger.
Mary Bernuth wants in, and she's
not alone.
Thanks to the 2018 U.S. Farm
Bill, hemp-based products are at
least quasi-legal across the United
States-and, unlike marijuana,
they're shippable across state lines.
Companies big and small are betting
on hemp-derived drinks becoming
the next big thing for healthconscious,
smoke-wary consumers.
Bernuth's Pharos Brands was one
of 30 hemp-derived THC beverage
companies at the Wine & Spirits
Wholesalers of America's January
expo at the Las Vegas Convention
Center. According to the Hemp
Beverage Alliance, hemp drink
companies took up as much as 10%
of the floor.
" We're killing it here, " Bernuth
told MJBizMagazine from the bustling
convention hall. Things went so well
that she's banking on contributing
to a movement as well as running a
successful business.
" We want to mainstream this, " she
said. " We feel hemp beverages are
an essential piece of destigmatizing
THC. "
But when the first can of Pharos
seltzer is sold in stores this spring
with 2.5 milligrams of hempsourced
THC, it won't be sold in
Montana, where Bernuth lives and
where Pharos is produced.
That's because Montana law
requires any end product with more
than 0.3% THC to be sold at a statelicensed
marijuana dispensary.
Such rules don't exist on the
other side of the Dakotas in
Minnesota, where a 2022 state law
specifically allows products with
low doses of hemp-derived THC to
be sold through mainstream retail
outlets such as supermarkets and
convenience stores.
In a familiar theme, states around
the country offer similar patchworks
of conflicting rules. At least, that's
the case for now.
The federal law that has allowed
a hemp-derived product market
worth billions to emerge almost
overnight could soon change-and
dramatically.
BIG BILL
From drinks to gummies or
smokable flower, the country's
appetite for psychoactive products
sourced from hemp is enormous.
And what economist Beau
Whitney estimates " conservatively "
as a $28.4 billion market barely
existed before the 2018 Farm Bill
accidentally legalized it.
That Farm Bill, which legalized
the production of hemp across the
United States, was intended to be a
boon for long-suffering producers
of low-THC cannabis intended
to be spun into fabric, pressed
into oil for fuel or processed into
health foods.
Hemp is also a source of CBD,
or cannabidiol, which can be
converted into psychoactive
38 March-April 2024 | MJBizMagazine
delta-8 THC, hence the boom
in delta-8-infused products.
The latest evolution is hempderived
delta-9 THC. Operators
with enough hemp also could
extract sufficient delta-9 THC to
produce and ship gummies and
other infused products that are
functionally identical to stateregulated
marijuana across
the U.S.
It's conventional wisdom that
federal lawmakers did not intend
to create this new market when
they legalized hemp production
nationwide with the 2018 Farm Bill.
Since then, businesses including
Pharos have existed in a state of
uncertainty that some argue is-if
you can believe it-even more
confusing than the regulated
marijuana industry.
The U.S. Food and Drug
Administration has publicly
declared that hemp-derived THC
has " serious health risks, " and the
Drug Enforcement Administration
has hinted it doesn't consider
certain hemp extracts legal.
However, federal regulators have
so far taken limited enforcement
action. Only companies selling
products marketed with unproven
medical claims or marketed with
packaging similar to mainstream
snack or beverage brands have
drawn negative attention-and then
usually nothing more serious than a
cease-and-desist letter.
But it's also understood this
uneasy status quo is temporary.
MJBiz - March/April 2024

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