Tennessee's most popular cannabis products could be pulled from shelves as soon as new rules take effect at the end of the year.
Sales of hemp flower, dried smokable cannabis, account for about 70% to 80% of Tennessee's legal hemp market, said Kelly Hess, executive director of the Tennessee Growers Federation.
“A lot of people are going to go out of business quickly,” Hess said by phone.
Many of those sales come from THCa flower, a precursor to delta-9 THC, the psychoactive compound found in high concentrations in illegal marijuana.
The rule, created by the Tennessee Department of Agriculture, is similar to the emergency rule already in place and the proposed rule first announced in December 2023.
Last year, Tennessee lawmakers passed the first comprehensive regulations for the cannabis industry, allowing the state to begin collecting cannabis taxes and directing the Department of Agriculture to establish rules for retail, labeling, and testing. commanded.
(Read more: Cannabis advocates sue Tennessee over 'emergency' rules)
The state has collected about $15.3 million in revenue since it began collecting the 6% tax in July 2023, according to Department of Revenue data.
Cannabis industry officials praised the regulations to crack down on dangerous “gas station” cannabis products, but many say the regulations go too far.
“The market is there. People want it and people are taking advantage of it,” Hess said. “It's really unfortunate that this has happened.”
In September, a coalition of producers sued the state over the emergency rule. The lawsuit has since been dismissed, according to attorney Alex Little. The coalition recently asked the department to declare parts of the rules invalid, but if the department doesn't agree within 60 days, the coalition plans to sue again, Little said by phone.
Mr Hess said the coalition government was also working on legislation to clear up confusion around flower, testing and labeling regulations.
When contacted via email, a spokesperson said the Department of Agriculture does not conduct interviews regarding cannabis regulations.
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Total THC
The rule would change how hemp products sold at retail stores in Tennessee are tested.
Previously, products were only required to have a concentration of less than 0.3% psychoactive delta-9 cannabinoids, which complies with federal regulations from the 2018 Farm Bill.
The new rules use a formula that takes into account how cannabinoids continue to grow after hemp is harvested to ensure that the combined content of both delta-9 and its precursor, THCa, is less than 0.3%. It requires products to do certain things.
When heated (such as by smoking or vaping), THCa converts to delta-9.
Hess said the change would also affect CBD flower, which would likely not pass the new testing standards. Unlike THCa, smoking CBD does not get you high.
Businesses must now decide how to adapt to new regulations.
“Some of them are in a position to pivot, but most are not,” Hess said. “Most of them are thinking about moving out of state and continuing to sell online in Tennessee, but that's just so ridiculous and stupid.”
(Read more: Cannabis or not? Everything you need to know about Chattanooga's cannabis industry)
In a written response to public comments submitted during the rulemaking process, the USDA said the changes bring testing in line with the spirit of the law.
“The majority of comments received opposed the rule and were based on opposition to specific items requested by the industry, which were not changed,” the department wrote. The restrictions on THCa” cannabinoid products are to be lifted. ”
Snapdragon Hemp, which is headquartered in Red Bank and has 11 locations in Tennessee, will have to change the composition of some of its products to comply with the regulations, CEO Josh Manning said. said. The new rules are scheduled to come into effect on December 26th.
“If someone tries something on December 24th and then tries something on December 26th, they want to get to the point where they say, 'I don't notice much of a difference,'” Manning said. he says. I was told this over the phone.
He said Snapgradon's dab bars allow retailers to switch from a pure THCa formulation to one that combines THCa, delta-9 and delta-8 (another cannabinoid).
Flower sales account for about 40% of Snapdragon's business, compared to 5% to 10% two years ago, Manning said. He said Snapdragon could focus more on edible gummies and cannabis drinks and switch to “nano” formulations, which have faster-acting effects than regular edibles.
“That's the beauty of smoke, you get high instantly when you smoke it,” Manning said.
Manning said he worries that without legal flowers, his customers will turn to the black market.
Snapdragon has one store in Fort Oglethorpe, Georgia, which Manning said helps it comply with local regulations. Georgia has a very limited medical marijuana program that allows the use of low-THC oil but does not allow the sale of flower.
“Georgia is catching up, but Tennessee is taking a step back,” Manning said.
Contact Ellen Gerst at egerst@timesfreepress.com or 423-757-6319.
