New Federal Hemp Law Sparks Uncertainty in New York Cannabis Industry

Last month, the U.S. Congress passed new legislation that will significantly impact the cannabis landscape, specifically the production and sale of certain hemp-derived products. The law, which is set to take effect in November 2026, introduces restrictions that could reshape the offerings in New York’s cannabis market, raising questions among industry leaders about its implications.

The legislation was included in a broader bill that aimed to end the federal government shutdown, catching many in the cannabis sector off guard. The changes essentially reverse the deregulation of hemp products established by the 2018 Farm Bill, which allowed for a wide range of hemp-derived items, including edibles and beverages with low levels of THC. This deregulation led to a surge in hemp products that often exceeded the legal THC limit of 0.3%, creating products with psychoactive effects similar to marijuana.

Allan Gandelman, a prominent figure in the New York cannabis industry and a founding member of the Cannabis Association of New York, expressed concern about the new developments. “There’s a lot going on here and a lot to think about,” he noted. The reaction among local business owners is mixed; while some see these changes as a potential threat, others are optimistic about clearer regulations.

According to Heather Trela, a fellow at the Rockefeller Institute of Government, the potential impact of the new law may not be as severe as some fear. “New York already has some of the strictest language regarding hemp in the country,” she explained, suggesting that businesses complying with the existing regulations will likely remain compliant under the new law. Trela also indicated that federal enforcement against New York businesses might be limited, saying, “The juice might not be worth the squeeze for them.”

Despite these reassurances, businesses selling THC-infused products are bracing for changes. For instance, Tim Shore, co-founder of Buried Acorn Brewing in Syracuse, mentioned that he might have to discontinue certain beverage lines due to the new restrictions. “What they’re talking about is exactly a product I make,” Shore said, referring to his hemp-infused seltzers. He is considering shifting to a cannabis base and selling exclusively to licensed dispensaries.

The situation is similarly precarious for Eddie Brennan, president of Ayrloom, a THC beverage company affiliated with Beak & Skiff Apple Orchards. Brennan highlighted that a significant portion of their business comes from Delta 9 THC beverages, which would be banned under the new law if no regulatory pathway is established. “That would completely go away after a year if they are not able to extend or find a path to regulation,” he stated.

In Cortland County, Gandelman’s business, Head & Heal, specializes in CBD products. He anticipates that his online sales to out-of-state customers will be prohibited under the new law. “We will be concentrating on New York-grown and processed products to be sold in New York,” he remarked, suggesting a pivot in business strategy that aligns with the new regulations.

Meanwhile, Rodney Haymes, who operates a cannabis shop in Syracuse called The Dispensary by the BudBoyz, foresees turbulence ahead. His business, which focuses on a hemp product called THCa, could be severely affected by the new regulations. “If it takes effect as is here in NY or any other state it will decimate the hemp industry as we know it,” he warned.

On a more positive note, Joe Rossi, founder of Modern Advocacy, a Syracuse-based consulting firm, sees the new law as a necessary transition. In an email, he stated, “For six years, intoxicating hemp products sold outside regulated cannabis systems have created confusion and real consumer-safety concerns.” Rossi believes the legislation marks a “reset moment” for the industry, emphasizing the need for safe and accurately labeled products.

In response to the new federal law, the New York Office of Cannabis Management has begun reviewing its implications. The Office has previously established strict standards to ensure that cannabinoid hemp products sold in the state comply with good manufacturing practices, prioritizing public health and consumer safety.

As the cannabis industry in New York grapples with these changes, the focus remains on ensuring compliance and adapting to the evolving legal landscape. The next few years will be crucial in determining how these federal restrictions will reshape the market and affect local businesses.