Michigan's Cannabis Industry Confronts New Federal THC Restrictions

Challenges Arise for Michigan's Cannabis Sector Amid New Federal Guidelines

The Michigan cannabis industry is navigating a new landscape of regulations that may hinder its growth following recent changes in federal policy regarding THC levels in hemp-derived products. A federal agreement, pivotal in resolving the government shutdown, has implemented stricter limits on THC content, creating uncertainty for local businesses and consumers alike.

The original framework established by the 2018 Farm Bill allowed for the sale of hemp products with a THC level of less than 0.3% by dry weight. However, the newly mandated cap is now set at just 0.4mg of THC per product, a stark contrast to the typical dosages seen in currently available low-dose products, which often range from 1-2.5mg of THC.

As the industry anticipates a year-long adjustment period, advocates and stakeholders are calling for legislative support to bolster hemp sales. Graham Filler, an advocate affiliated with the Hemp Beverage Alliance, expressed optimism regarding the future, commenting, “I feel like we got so far down the road with great bipartisan, bicameral, legislative support and stakeholder support, why not create that framework?” His remarks coincide with Michigan’s recent implementation of a 24% wholesale tax on cannabis products as part of a budgetary agreement.

Plans to expand cannabis sales into venues like liquor stores and restaurants seemed promising, especially in a market characterized by saturation. Filler acknowledged that many investors are struggling to recoup their investments due to competition from the black market, stating, “A lot of people who invested have not made their money back because they’re battling with the black market and they have too much flower.”

Despite significant bipartisan support, advancing local legislation may be hindered by the ambiguity of federal policies. State Representative Joseph Aragona, who leads the House Regulatory Reform Committee, noted that this uncertainty is a significant drawback for Michigan’s cannabis industry. “The uncertainty is really what’s kind of killing us at this point as to why we might not move forward at a state level,” he explained. This situation leaves legislators weighing the options of either preparing for a potential easing of federal regulations or holding steady until clearer guidelines are issued.

Aragona elaborated on the difficulties lawmakers face in committing to new regulations, which might soon become outdated. "It’s a lot harder to do that now with a limited time frame. I mean, it’s easier to do nothing than to do something,” he remarked, highlighting the complexities of the legislative landscape in light of current changes.

With critical discussions set to unfold in the coming months, the future of cannabis legislation in Michigan remains uncertain. Aragona captured the essence of the situation by likening it to a game interrupted just as a pivotal moment was about to take place. “We’re still reeling from that and, you know, once we get back on our feet and think through this process and what it really looks like, you know, we’ll have better answers,” he concluded.