North Carolina’s Hemp Industry at Risk: How the Government Shutdown Deal Threatens Small Businesses

Hemp has thrived and created real economic opportunities in the rolling fields and small storefronts across North Carolina, transforming local wellness markets. Family farms, local shops, and craft beverage makers have invested years of hard work and effort into producing and selling hemp products that benefit health and create local jobs. For instance, a small farm in Buncombe County that changed from tobacco farming to full-spectrum hemp now provides dozens of sheds in town and gives adults safe wellness options, benefiting the local economy.

Now, that growth is under serious threat. A new deal for the federal government shutdown contains a provision that could ruin the legal hemp market in NC. For the small business owners whose livelihoods are built around full-spectrum hemp products, this legislation is more than policy – it’s a potential crisis.

A Hidden Provision with Huge Consequences

The deal meant to reopen the federal government includes a surprising twist: a restriction on hemp-derived THC. This would limit the THC content in hemp products to 0.4mg/container, which is much lower than what many companies in NC use currently.

Under the federal laws established in the 2018 Farm Bill, as well as the regulations established in North Carolina, many low-level THC products, including drinks, gummies, and topicals, are legal. This new restriction may ban a huge part of what local shops currently sell. For insights on related regulatory challenges, check if FDA’s Stance on CBD is Hurting American Businesses?

The Human Cost: Jobs, Farms, and Community Spaces

North Carolina’s hemp economy is powered not by large national brands, but by small independent shops, regional processors, and family farms. These are the people who may lose the most.

• Small Businesses Under Threat

Most hemp vendors in North Carolina are small, independent shops. They not only built to sell a product, but also to educate, to offer a welcoming environment, and to help a community’s economy grow. For these business owners, the new THC limit is not a basic regulation; it means huge losses in inventory and possible closure.

• Farms and Production

Families that changed their tobacco or traditional agriculture practices to hemp are also worried on the farming side. An example of this is OtherSide Farm in Buncombe County, which grows full-spectrum hemp as its customers want. They fear the ban could take away all of their products. 

Since many of these family farms do not have the equipment to manufacture THC-zero isolates, they just can’t pivot — putting them at real risk of shutting down.

• Revenue Hit for Local Beverage Makers

Not just farm or retail shops — even North Carolina breweries are feeling the pressure. For example, Foothills Brewing launched a hemp-infused beverage business, which now makes up over 20 percent of its total revenues.

If key products are made federally illegal, that line of business could disappear almost overnight.

Why the Provision Is So Controversial?

Even though lawmakers claim the change aims to protect children and close loopholes, responsible businesses will suffer badly.

• Claimed Intent vs. Real Outcome

Federal leaders say the rule will prevent intoxicating hemp products from reaching kids. North Carolina hemp shops have age limits, responsible packaging, and check IDs only for THC. These are wellness stores, not convenience stores selling harmful items. The new restriction punishes the very businesses that follow the rules.

• Legal and Regulatory Reality

Experts warn that the HC limit might redefine hemp under federal law, which will make most legal NC products controlled substances. The whole local industry may be disrupted due to this reclassification.

The Ripple Effect: Consumers, Wellness, and Public Health

The effects are not just economic, but also public health and choice-related.

• Wellness Consumers Lose Access

Hemp-derived products can help adults with stress relief, sleep support, managing pain, and overall wellness. Many people find that the small amount of naturally occurring THC in full-spectrum products is essential for their use. If these products get removed, consumers may start using opioids, alcohol, or unregulated THC products, which pose public health risks.

• Banking, Distribution, and Local Economy

If products are federally banned, then hemp revenue may be viewed as illegal, and access to banking and insurance could be restricted. Job losses and lower tax revenue could happen. That would threaten North Carolina’s fast-growing wellness industry.

A Call for Reasoned Regulation — Not Prohibition

Hemp leaders in North Carolina have said repeatedly they support clear, sensible rules, not wholesale bans.

They emphasize that they want to protect: 

• Good Actors: Small farms, licensed producers, transparent retailers.

• Consumers: Many adults who use these products seek wellness, not intoxication.

• Children: Children should be supported by age restrictions and responsible marketing, not by blanket bans. 

• Local economies: They benefit through jobs, tax revenue, and business opportunities.

Many in the industry hope that over the next year — before the ban would take effect — there will be enough public pressure to re-open the conversation, revise the language, or even remove the punitive provision. For context on broader cannabis and hemp policy, see Introduction to the Legal and Medical Cannabis Landscape.

Conclusion: 

North Carolina’s hemp industry stands at a pivotal moment. What started as a good opportunity for farmers, small business owners, and wellness communities is at risk due to one specific provision within a federal shutdown deal.

The NC hemp shutdown has economic as well as public health impacts. It can also affect community trust in safe wellness products. Numerous North Carolinians rely on these ingredients to bring them relief, balance, and everyday wellness. Taking them away in the name of regulation will impact livelihoods.

It is time for NC entrepreneurs, consumers, and community leaders to demand protection, not prohibition. Responsible businesses should be allowed to continue operating, families should be allowed to continue farming, and wellness-minded adults should be allowed to continue accessing safe, regulated hemp products.

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