A new federal regulation on hemp targeting an unregulated market of intoxicating substances has sweeping impacts into the realm of wellness products and could upend a fast-growing industry.
Tucked within the funding bill which ended the record government shutdown in November, Section 781 bans most hemp-derived THC products by imposing strict limits on THC content (no more than 0.4 milligrams of THC content per container) and outlawing compounds synthesized outside of the hemp plant effective Nov. 12, 2026.
Cracking down on hemp-derived products
When the 2018 Farm Bill legalized hemp, defining it as any part of the plant with no more than 0.3% concentration of delta-9 THC (marijuana) on a dry weight basis, Congress did not account for several compounds, called cannabinoids, within the plant.
That created what lawmakers have called a loophole that allowed for a boom of production and sale of hemp-derived products: delta-8 THC, THCA, and HHC produce intoxicating effects similar to marijuana without exceeding the 2018 regulation.
“These substances you could buy at a corner grocery store, a small mini mart, a gas station– available to kids, young people,” Washington Fourth Congressional District Representative Dan Newhouse said in an interview with NonStop Local. “There’s no true regulation… the label could say one thing, and you could get something entirely different.”
Delta-8 THC is a naturally occurring cannabinoid in hemp. However, the plant produces the cannabinoid in such trace amounts that the vast majority of products on the market are composed of man-made delta-8 synthesized from CBD through a chemical process.
America’s Poison Centers in 2022 managed 3,358 cases of delta-8 THC exposure–an 82% rise from the previous year–and from 2018-2021, the FDA reported 22 deaths where delta-8 was found present. The cannabinoid was the only suspect product in 4 of those deaths.
The FDA has not evaluated or approved delta-8 products for safe use.
“[Delta-8 THC products] may be marketed in ways that put the public health at risk and should especially be kept out of reach of children and pets,” a fact sheet on the FDA website reads.
“Entire industry will shut down”
The crux of the latent harm critics point to in opposition to this regulation comes down to the new definition effectively banning hemp.
The former definition of 0.3% delta-9 THC content allowed for enough, though still marginal and non-intoxicating, levels of that cannabinoid to produce CBD wellness products for sale in some states where marijuana remains illegal.
“If you try to take the THC out, it is a really expensive proposition and a really difficult one to do correctly,” President Mike Goettl of Wapato-based Vuca Farms said. His work is in producing hemp oil specifically for CBD products.
“0.4 milligrams [of delta-9 THC content] is impossible,” Goettl said. “That means all of a sudden we’re breaking the law. The entire industry will shut down.”
More than his business, Goettl says he worries about wellness products being taken off the shelves.
“By blocking and trying to ban hemp on this new law, [Congress is] taking away the opportunity for millions of Americans to use this for health and wellness reasons,” Goettl said.
CBD products have exploded onto the market in recent years as an alternative for opioids and prescription medications: oils, creams, rubs, edible gummies and more which show promise for treating numerous health complications.
Anecdotally and in relatively few studies, CBD has been found to treat epilepsy, arthritis, soreness, inflammation, as well as managing PTSD and mood–making it a popular option for first responders and veterans–though many health experts caution more research is needed to confirm its efficacy in those applications.
“These heroes are using CBD products because it’s a way of finding a non-addictive form of pain relief,” Goettl said. “It works tremendously.”
Calls for better regulation
Ahead of the spending bill’s passage, South Carolina Rep. Nancy Mace blasted the hemp regulation as a ‘fatal blow’ to American farmers, citing a 2023 Whitney Economics report that estimated the $28 billion industry supports more than 320,000 jobs and pulls in $1.5 billion of state tax revenue.
Sen. Rand Paul and Rep. Thomas Massie for Kentucky argued the regulation had no place in the bill that reopened the government.
“I think it was absolutely the proper place to address this,” Rep. Newhouse said. “This is an issue that has been talked about for several years now.”
“I think this is actually going to increase the opportunities for hemp producers,” Newhouse said. “Now that there are more clear regulations surrounding this industry, it will allow it to grow on a legal basis. So I think it will actually end up being a good thing for our hemp farmers.”
Rep. Newhouse said he is bringing together industry players for a work group to discuss the regulation as currently written.
“We’ve been listening very closely,” Newhouse said. “I think we came up with a very positive product in the legislation that meets a lot of the needs we have and also allows us to look with this working group into the future… and see what more needs to be done.”
Goettl said hemp producers have been asking for regulation for years, but this sweeping law started off on the wrong foot.
“We very much agree that we don’t want [intoxicating hemp-derived products] in the hands of children. We have children and grandchildren ourselves,” Goettl said. “We don’t ban apples, for example, because a bad actor can make an alcoholic cider out of that and sell it under the table to minors… we find a way to regulate.”
Goettl said hemp producers in Washington have been in contact with Newhouse as well as Washington Senators Maria Cantwell and Patty Murray.
Oregon Senators Ron Wyden and Jeff Merkley in September wrote to Senate leadership to call for better regulation of hemp, calling Section 781 a “hurried attempt that will not achieve its worthy public health and safety goals.”
“We’re hopeful that once our senators and our representatives really understand the ramifications, they will make changes,” Goettl said.
