Uncertainty hangs over the hemp industry, including businesses in Wilmington that depend on the sale of hemp-based THC products.

THC stands for tetrahydrocannabinol, the compound in a cannabis plant that can make users high when they smoke flower or ingest an edible containing a certain amount.

Federal legislation and a North Carolina proposed law would change the definition of hemp to the point of driving some companies out of business. At the state level, HB 328 has been paused as legislators work on a potential compromise.

That means the biggest concern in the industry locally and elsewhere in the state is the federal legislation that would take effect Dec. 11.

If it’s taken up again and passes, the state bill “would effectively end the entire industry in North Carolina, as would the potential federal language change to the definition of hemp in December,” said Ben Erichsen, owner of the Wilmington Dispensary.

Congress legalized hemp in 2018, and although hemp and marijuana both come from the cannabis plant, the law said hemp was legal if it contained no more than 0.3% of delta-9 THC. The new federal law says a finished product can contain no more than 0.4 milligrams of THC in an entire package, which is a minuscule amount.

That takes most products sold by Wilmington Dispensary and a separate hemp business, Wilmington-based Hemp Farmacy, off the market. It also means the end of hemp-derived THC drinks that have proliferated in stores and bars locally and across the U.S.

Erichsen said Wilmington Dispensary’s mildest THC gummy has 5 mg each in jars of 20 gummies. The new definition and the state proposal would result in a jar that could contain as much THC as one-twelfth of one of those gummies, he said.

Hemp Farmacy owner Justin Hamilton is optimistic about the future for now, although a federal legislation clock displays red countdown numbers at his flagship store on South College Road.

“What we’re anticipating is that there’s going to be an extension of one year or two, and then there’s going to be a promise of regulation,” Hamilton said.

President Donald Trump has advocated for changes to the wording.

“I am calling on Congress to update the Law to ensure that Americans can continue to access the full-spectrum CBD products they have come to rely on, and that help them, while preserving Congress’s intent to restrict the sale of products that pose Health risks,” wrote Trump in a Truth Social Post, according to multiple news outlets.

Hemp is the whole plant, while CBD is an active cannabinoid that comes mainly from the plant’s flowers and leaves.

Despite Trump’s backing, the uncertainty around the upcoming federal deadline is a big problem, Hamilton said.

“If we don’t get some kind of permanent regulation … then whoever’s next to be president, it’s going to be up in the air again,” he said.

Hamilton founded Hempleton Investment Group, which owns Hemp Farmacy as a subsidiary, in 2015. Hemp Farmacy has grown to seven locations – three in Wilmington, one in Hampstead, one in Southport, one in Jacksonville and one in Raleigh.

He said that during the COVID pandemic that started in 2020, the company shut down its franchise program and returned to corporate-owned stores only.

“The industry wasn’t ready for that. I wasn’t willing to sell somebody a franchise where they’re going to use their life savings to buy a franchise, and then the government’s going to change the rules within the year,” Hamilton said.

Wilmington Dispensary has three locations in the Wilmington area, including Erichsen’s original store on Castle Street. Another business he owns, Carolina Pure, is the production company that makes many of the products Wilmington Dispensary sells, including gummies, tinctures, lotions and more.

Like Hamilton, Erichsen is optimistic the current federal language could change. Still, he said, he recently became aware about the impact a potential government shutdown could have before Congress takes action to cancel or delay the new hemp definition.

He said he doesn’t think “anyone’s going to take it upon themselves to try to strip the hemp language out of that continuing resolution and make a standalone bill and do something with it right ahead of Christmas. That’s highly unlikely. … Something has to happen to make it not take effect.”

Meanwhile, the financial entities that support hemp-based businesses could get antsy.

“I’m worried that they’ll be forced into preemptive action in curtailing or eliminating financial services to the industry,” Erichsen said.

As for the state bill, Erichsen is working with a group of other advocates to help find a solution. Many advocates and opponents agree that the industry needs regulations, such as outlawing sales to anyone under age 21, child-proof packaging and other safety standards.

“We’re advocating for responsible and sensible legislation in North Carolina to take care of the mess we’re currently in,” Erichsen said.

Wilmington Dispensary and Hemp Farmacy locations have self-imposed an age 21 rule, among other restrictions.

Legislative language that minimizes the occurrence of “bad actors” and mitigates risks to children won’t demolish the hemp industry. But the paused state ban and upcoming federal ban will, Erichsen said. Dispensary businesses, in general, would have so few legal products to sell that they couldn’t cover their bills, he said.

For example, the Wilmington Dispensary has more than 40 employees.

Erichsen said, “I’d like to preserve their jobs if at all possible.”