CRA rules under review July 23 could determine whether Michigan attracts hemp farming, processing and manufacturing—or sends those opportunities to competing states
LANSING – Michigan hemp farmers, processors, manufacturers, retailers and consumers are being encouraged to participate in an upcoming Cannabis Regulatory Agency public hearing that could help determine whether the state becomes a meaningful participant in the expanding industrial hemp economy.
The CRA will hold a second public hearing on proposed changes to Michigan’s Marihuana Rules at 9 a.m. Thursday, July 23. The agency is accepting testimony on changes involving processors, product manufacturing, testing, transportation, labeling and the statewide monitoring system. Written comments will be accepted until 5 p.m. Friday, July 24. (Michigan)
Although the hearing concerns Michigan’s regulated marijuana system, several provisions could affect how lawful industrial hemp is received, processed, stored, documented and transferred when it enters a licensed cannabis business.
For Michigan, this is about more than regulatory language. It is about whether the state will establish conditions that encourage farmers, processors and manufacturers to invest—or whether those businesses will continue building the hemp supply chain elsewhere.
Michigan Is Capturing a Small Share of Hemp Production
The latest National Hemp Report from the U.S. Department of Agriculture shows that the value of U.S. hemp production reached $739 million in 2025, an increase of 64 percent from 2024.
Farmers planted 49,267 acres of outdoor hemp nationally and harvested 43,707 acres. Production increased in several important categories. Grain production rose 112 percent, seed production increased 190 percent, and the amount of harvested fiber acreage grew by 14 percent. (NASS)
Michigan accounted for only 280 planted acres and 235 harvested acres in 2025. That was about 0.6 percent of all outdoor hemp acreage planted nationally.
Michigan’s 280 planted acres compared with 6,700 acres in Texas, 4,800 in Kentucky, 4,000 in California, 3,300 in Nebraska, 3,200 in Kansas and 3,000 each in Colorado and Oklahoma.
Michigan also trailed several states in its own region, including Minnesota with 2,700 planted acres, Ohio with 920, Illinois with 730 and Wisconsin with 550.
Those numbers do not mean Michigan has missed the opportunity. They show how much ground remains to be gained.
Michigan can either create a practical regulatory environment that attracts hemp businesses or impose overlapping marijuana-oriented requirements that make investment in other states easier and less risky.
The Potential Market Is Much Larger Than Today’s Acreage
Whitney Economics has projected that demand for hemp fiber and grain could eventually require a dramatically larger U.S. crop.
The economic research firm previously estimated that hemp grain and fiber demand could support 5.5 million acres by 2030. It later reduced that forecast by 82 percent to one million acres, citing regulatory risk, inadequate processing infrastructure and uncertainty surrounding federal hemp policy.
That reduction represented nearly $3.1 billion in projected revenue that American farmers may not receive because the industry is developing more slowly than its underlying market potential would support. (Cannabis Business Times)
Even Whitney Economics’ reduced forecast of one million acres is more than 20 times the total outdoor hemp acreage planted across the United States in 2025. That gap illustrates both the scale of the opportunity and the amount of work still required to build a functioning market. (NASS)
Farmers will not plant millions of acres without reliable buyers. Manufacturers will not commit to hemp materials without dependable supplies. Investors will not finance processing facilities when licensing rules, product definitions and enforcement policies remain uncertain.
Regulation therefore plays a direct role in determining whether the hemp economy grows—and where that growth occurs.
Hemp’s Potential Extends Far Beyond CBD
Industrial hemp is not a single-product crop.
Hemp grain can be used in food ingredients, protein products, cooking oil and animal nutrition. Fiber and hurd can be used in textiles, paper, packaging, insulation, construction products, bioplastics, automotive components and animal bedding.
Cannabinoids such as CBD represent another major segment, but they should not be confused with the entire hemp industry.
Whitney Economics’ 2023 National Cannabinoid Report estimated that demand for hemp-derived cannabinoid products exceeded $28 billion. The firm calculated that the sector supported approximately 328,000 workers earning $13 billion in wages and produced more than $79 billion in total economic activity.
Whitney Economics described those figures as conservative because they did not include some demand and employment generated through grocery stores, convenience stores and gas stations. (Whitney Economics)
Those estimates demonstrate that hemp policy affects more than a small group of growers. It affects farmers, laboratories, manufacturers, retailers, truckers, product developers, construction companies, consumers and communities seeking new forms of agricultural and industrial development.
Michigan should address legitimate concerns involving intoxicating products, youth access and consumer safety. But it should do so without treating every hemp product as though it presents the same risk as high-THC marijuana.
Hemp grain, fiber, construction materials and non-intoxicating wellness products should not become collateral damage in the effort to regulate intoxicating cannabinoids.
Processing Infrastructure Will Determine Who Benefits
A successful hemp industry requires more than farmers willing to grow the crop.
It needs seed suppliers, harvesting equipment, drying capacity, storage, testing laboratories, decortication facilities, extraction equipment, transportation, manufacturers and committed buyers.
Processing infrastructure is particularly important because bulky raw hemp materials can be expensive to transport. Farmers need access to processors within a practical distance, while processors need enough contracted acreage to justify the cost of equipment and facilities.
That creates a difficult cycle. Farmers hesitate to plant without processors, and processors hesitate to invest without farmers.
Clear and practical regulations can help break that cycle. Uncertain or duplicative rules make it worse.
A company considering a Michigan processing facility needs to know which licenses will be required, how lawful hemp may be received, whether intermediate materials can be handled, which testing rules apply and whether the company will be required to operate within systems designed for marijuana.
When those answers are unclear, capital does not necessarily wait for Michigan to resolve them. It moves to another state.
Keep Agricultural Hemp Out of Marijuana Tracking Systems
One of iHemp Michigan’s central concerns is the possible application of marijuana inventory controls to hemp farmers and processors.
Hemp businesses should be able to document lawful products through ordinary commercial records, including invoices, certificates of analysis, lot numbers, licenses and shipping documents.
When a hemp-derived ingredient enters a licensed marijuana facility, the receiving business may need to record the transaction. That does not mean the entire upstream hemp supply chain should be forced to operate in Metrc or another marijuana-specific tracking system.
Marijuana plant tags and seed-to-sale inventory controls were designed for high-THC cannabis. Applying the same system to agricultural commodities would add cost and complexity without necessarily improving public safety.
The rules should distinguish between documenting hemp entering a licensed cannabis business and forcing farmers, transporters and upstream processors into a marijuana tracking system.
Allow Adult-Use Processors to Work With Hemp
The final rules should clearly permit both medical and adult-use processors to receive and process lawful industrial hemp.
Unclear language could create a situation in which a medical marijuana processor is allowed to handle hemp while a processor licensed only for the adult-use market is excluded.
That distinction would reduce the number of potential buyers available to Michigan farmers and limit the state’s processing capacity.
Michigan needs more lawful pathways for hemp processing, not technical language that unintentionally narrows the market.
Avoid Duplicate Licenses and Excessive Fees
Businesses already licensed, inspected and accountable to the CRA should not be forced to purchase another expensive license solely to handle lawful hemp.
A streamlined endorsement, automatic authorization or reasonably priced registration could provide accountability without creating duplicative licensing costs.
Large multistate companies may be able to absorb additional fees and administrative requirements. Smaller Michigan processors, manufacturers and product developers often cannot.
Poorly designed rules can therefore favor large operators while keeping local entrepreneurs and family businesses out of the market.
Create Practical Storage Requirements
The proposed rules address the separation of hemp and marijuana inventory.
Hemp products should be clearly labeled and stored in a way that prevents confusion. A designated shelf, cabinet, container, pallet or storage area may provide reasonable separation.
Businesses should not be required to build a separate vault, secure room or building simply to store lawful hemp ingredients.
The purpose of the rule should be accurate inventory management—not treating every hemp product as though it carries the same legal and public-safety risks as marijuana.
Protect Traditional Industrial Hemp Products
Michigan’s rules should clearly distinguish intoxicating cannabis products from conventional industrial hemp commodities.
Hemp fiber, hurd, grain, seed, food ingredients, textiles, hempcrete, insulation, animal bedding, paper and bioplastics should be regulated according to their intended uses.
They should not be subjected to marijuana packaging, security, testing or inventory requirements merely because hemp and marijuana are varieties of the same plant species.
A product’s actual characteristics and intended use should determine how it is regulated.
That distinction will become increasingly important as manufacturers explore hemp-based materials for construction, packaging, transportation and other industrial uses.
Give Legitimate Hemp Processing a Legal Pathway
Normal hemp extraction can temporarily concentrate THC and create an intermediate material that exceeds the federal 0.3 percent delta-9 THC threshold.
That intermediate material is not necessarily a finished consumer product. It may require additional processing, remediation or separation before it reaches its intended specification.
Michigan needs a clear pathway allowing licensed processors to possess and continue working with such material when it originated from documented lawful hemp, remains inside an authorized facility, is not sold to consumers in that form and is properly remediated, transferred or destroyed.
Without that protection, ordinary processing can create unnecessary legal exposure. Michigan farmers may then struggle to find processors willing to buy their crops.
Require Clear, Public THC Standards
Any new THC limit affecting finished hemp products should be stated directly in the rules and supported by a transparent explanation.
Major restrictions should not appear later through informal guidance, laboratory instructions, bulletins or changing enforcement interpretations.
Businesses need to know which products are covered, whether limits apply to full-spectrum CBD products, how THC will be measured and whether calculations will be based on concentration, serving size, package size or another standard.
Companies cannot confidently invest, hire employees, develop products or enter supply contracts when fundamental requirements remain uncertain.
Clear rules also benefit regulators and consumers by creating standards that can be understood and consistently enforced.
Michigan Has a Choice
Other states are already planting substantially more hemp and developing the relationships needed to support farmers, processors and manufacturers.
Michigan still has an opportunity to compete, but it will not do so by treating industrial hemp as an afterthought within the marijuana system.
The state needs rules that recognize the differences between marijuana, intoxicating hemp products, non-intoxicating cannabinoid products and traditional industrial commodities.
Protecting consumers and encouraging economic development are not conflicting goals. Michigan can do both by establishing clear testing standards, age restrictions where appropriate, transparent labeling and reasonable business requirements—while avoiding unnecessary barriers for farmers and manufacturers.
The July 23 hearing gives the hemp community an opportunity to explain those distinctions before the rules become final.
Join iHemp Michigan and Strengthen the Industry’s Voice
Public testimony at the CRA hearing is important, but building a competitive Michigan hemp industry will require sustained advocacy beyond one meeting.
iHemp Michigan is a member-based trade association representing hemp farmers, seed cultivators, processors, manufacturers and other businesses across the state. Its mission is to educate, inform and promote the research, development and cultivation of industrial hemp in Michigan. (iHemp Michigan)
Membership support helps the organization review proposed regulations, communicate with policymakers, prepare public comments and keep Michigan farmers, businesses and consumers informed.
A larger membership also gives the organization a stronger voice when lawmakers and regulators consider policies affecting hemp cultivation, processing, product development and consumer access.
Current membership options include a $50 annual individual membership, a $199 business membership and a $499 corporate sponsorship. Benefits vary by level and include industry communications, event discounts, networking, directory listings and promotional opportunities. (iHemp Michigan)
Farmers, entrepreneurs, manufacturers, retailers and consumers who want Michigan to participate in the emerging hemp economy are encouraged to join iHemp Michigan.
Membership is one practical way to ensure that Michigan hemp policy is shaped with input from the people who grow, process, manufacture, sell and use these products.
How to Participate in the CRA Hearing
The public hearing begins at 9 a.m. Thursday, July 23, 2026, in the Sun Conference Room at the Cannabis Regulatory Agency, 2407 N. Grand River Ave. in Lansing.
Virtual participation is available through Zoom. The meeting passcode is 151914.
Written comments may be emailed to [email protected] and must be received by 5 p.m. Friday, July 24. Comments may also be mailed to Attention: Rules, P.O. Box 30205, Lansing, MI 48909. (Michigan)
Comments do not need to be lengthy or highly technical. Farmers and business owners can explain how a proposed requirement would affect their costs, customers, investment plans or ability to operate.
Consumers can explain why continued access to lawful hemp products matters to them.
Manufacturers and entrepreneurs can describe the jobs, products and facilities Michigan could gain—or lose—depending on how the rules are written.
Michigan’s hemp industry may still be small, but its potential market is not.
The decisions made now could determine whether Michigan farmers and manufacturers participate in that opportunity or watch it develop somewhere else.
