The bill that reopened the federal government also closed a legal loophole allowing intoxicating hemp products. That may end a $1 billion industry in Indiana.
The loophole, created by the 2018 Farm Bill, allowed the growing and processing of hemp, so long as plants and products didn’t contain more than 0.3% of the psychoactive THC delta-9 compound by weight.
However, the law had no language about similar delta-8 and delta-10 compounds, which can also produce intoxicating effects.
Processors of the plant were able to take non-psychoactive extracts and synthesize them into the intoxicating THC delta-8 compound.
The new regulations would place legal THC levels at 0.4 milligrams per container, below even the trace amounts found in many cannabidiol, or CBD, products used medicinally and not meant to get people ‘high.’
Scott Noroozi owns a hemp business in Bloomington. He said the threat to his business could be significant – even many of the non-intoxicating products he sells will be illegal under the new regulation.
“Even CBD products at this point are all going to be outside of the limitations that the new bill is putting in place, because they're putting a really low ceiling about how much THC can be present,” he said.
Noroozi plans to scale back his THC offerings and look into CBD products that fall under the new regulations.
Brian Nixon, a farmer who grows, processes, and sells hemp extracts, is less worried. None of his products are intoxicating, and while some contain trace levels of the compound THC leftover from processing, he thinks he’ll be able to remediate products down to legal levels of THC.
He’s in favor of the new law and describes the production of intoxicating products from hemp as something he disliked.
“It was something that we frowned upon.We did not get into that that realm. We did not sell our biomass to people that were going to do that. It was just a side of things that we didn't really believe in as a company.”
Marguerite Bolt is Purdue’s Hemp Extension specialist. Her department works with farmers across the state who grow hemp for grain, fiber, and to be processed into non-intoxicating extracts.
She said that the .4 mg figure seems arbitrary and doesn’t appear to be based in existing scientific research on hemp.
“I don't know what that comes from. I don't know who came up with it. If this was like Mitch McConnell came up with that value, if he consulted with somebody, it's unclear to me.”
Bolt also said that a ban could hurt Hoosiers farming a legal crop and has the possibility of pushing buyers into the black market.
“I don't see how this is going to necessarily help prevent people from getting these products. It's just going to hurt the legitimate businesses that are doing everything right.”
One thing that Bolt, Noroozi, and Nixon all agree on is that more regulation is needed for hemp.
Nixon said he wants common sense guidelines.
“We want to make quality products, high quality products that are safe to use and have health benefits,” he said. “And to do that, there's nothing wrong with having some parameters and some guidelines and some rules regulations, some standards that you have to hit. And right now, there are none of those things.”
Noroozi said that despite his fears for his business, he understands why the new regulations are taking effect.
“I have mixed feelings because at the same time, the loophole was not exactly legal, like, I mean, it was an interpretation that was taken advantage of, and it's almost like we got it back.”
The new THC regulations go into effect November 2026.
