Hemp vs. Cannabis in Minnesota: Understanding the Legal Differences
Minnesota’s cannabis landscape is rapidly evolving, making it essential to understand the legal distinctions between hemp and cannabis. Both originate from the Cannabis sativa plant species, but their legal classifications, THC limits, and regulatory frameworks differ significantly. This knowledge is crucial for consumers, business owners, and investors navigating Minnesota’s expanding market.
Defining Hemp and Cannabis Under Minnesota Law
The primary distinction between hemp and cannabis lies in their THC (tetrahydrocannabinol) content—the psychoactive compound responsible for the “high” associated with marijuana use. Under both federal and Minnesota law hemp is defined as cannabis containing 0.3% THC or less on a dry weight basis, while cannabis includes any cannabis product with more than 0.3% THC on a dry weight basis.
This distinction aligns with the federal guidelines established by the 2018 Farm Bill, which legalized hemp nationwide, permitting its cultivation, sale, and use for various purposes, including CBD products.
Regulatory Differences in Minnesota
Hemp Regulations
Cultivation: Hemp cultivation is regulated under the Minnesota Department of Agriculture (MDA). Interested hemp cultivators must apply for a license with the MDA before beginning their grow. Applications for hemp cultivation must be submitted before April 30 of each year in order to begin operations.
Retail & Manufacturing: The retail sale of hemp and hemp-derived products are overseen by the Department of Health and Office of Cannabis Management (OCM) and sellers are required to register with the OCM if they wish to continue selling low-THC hemp derived products. While the OCM is still finalizing the rules for this, registration will close immediately upon the adoption of the rules. So, if you haven’t registered your hemp business with the OCM, it’s time to do it!
Cannabis Regulations
Adult-use cannabis was legalized in Minnesota in August 2023 and the OCM has since been working to license qualified businesses to get the market up and running. There is currently an application window open until March 14 for those seeking retail, manufacturing, cultivation, microbusiness, mezzobusiness, and testing lab licenses. Application and license fees range from $500 to $20,000 and some licensees will have the opportunity to operate up to 5 facilities.
How Cannabis and Hemp Businesses Navigate These Laws
For businesses operating within Minnesota’s hemp and cannabis sectors, understanding and adhering to these regulations is vital for compliance and success. One of the most important things to note while navigating hemp and cannabis laws is that those who hold a hemp license cannot also apply for or hold a cannabis license. Additionally, cannabis license applicants may only apply for one license and may only hold ownership in one cannabis business.
Another area where both businesses must pay attention to is the THC limits, especially with low-potency hemp-derived products. Keeping products under the 0.3% threshold and properly labeling will be crucial in operating a compliant hemp facility. As we know, the cannabis industry is extremely strict when it comes to packaging, THC limits, proper storage, and security, so ensuring you are well-versed in these regulations will keep your business compliant.
In Conclusion
Minnesota’s legal landscape for hemp and cannabis is complex but offers significant opportunities for those who understand and comply with the laws. While hemp-derived products, including THC-infused beverages and edibles, have become increasingly accessible, cannabis regulations continue to evolve as the state establishes its adult-use market. Whether you’re an entrepreneur, consumer, or investor, start your journey with the knowledgeable team at Canna Advisors.
Reach out to us today to start your cannabis or hemp application.