Virginia’s recreational cannabis market is expected to launch next summer if lawmakers approve the final state budget, but uncertainty surrounding state and federal rules is already affecting businesses tied to the hemp industry.
Barbara Biddle, owner of District Hemp Botanicals in Manassas, recently informed her landlord that she will close one of her two retail locations. Her stores offer hemp-derived products such as lotions, bath products, gummies, and beverages containing CBD and THC, compounds naturally found in hemp and cannabis plants.
Both CBD and THC are often promoted for potential benefits that include easing pain, reducing stress, and helping with anxiety. THC-infused beverages have also gained popularity among consumers seeking an alternative to alcohol.
The industry now faces major changes on two fronts. Updated federal rules narrowing the definition of hemp are scheduled to take effect in November, while Virginia’s recreational marijuana market could begin operating next July.
Congress expanded the hemp market through the 2018 Farm Bill, allowing products containing no more than 0.3 percent THC. However, lawmakers have revised that approach, and many products currently available could become illegal once the new federal standards are enforced this fall.
Biddle said the changing legal landscape has made planning difficult. Although she explained that expecting a new baby also influenced her decision to reduce operations, ongoing regulatory uncertainty played a significant role.
The same concerns are affecting farmers. Graham Redfern, who grows hemp in Caroline County, said many of his crops could lose their legal status once the federal changes take effect. He argued that mature hemp naturally produces cannabinoids, making it difficult to build a sustainable hemp business under the proposed standards.
Virginia has already tightened oversight of hemp products following an increase in poison control calls involving children who mistakenly consumed edible products and adults who experienced stronger effects than expected. A 2023 law introduced stricter packaging rules, mandatory third-party laboratory testing, clearer labeling, and lower THC limits.
Biddle and Redfern disagree, saying responsible businesses have followed federal and state requirements for years. They believe recent policy changes favor larger corporate interests while placing small Virginia businesses at risk. Redfern noted that growers and retailers have repeatedly met with lawmakers and the governor seeking solutions but now fear many small operations may not survive without additional time before the new regulations take full effect.
The debate came as state leaders continued negotiating Virginia’s budget as the July 1 deadline approached, with disagreements over data center tax policy threatening to delay final approval.
Developments in Virginia regarding hemp and marijuana regulation will be closely tracked by various industry actors, such as Aurora Cannabis Inc. (NASDAQ: ACB) (TSX: ACB), both within and outside the country.
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