Edibles set off a cautious gold rush in Minnesota
Dennis Buchanan's stores are fully stocked with THC edibles because he was ready for July 1, when a new state law legalizing them went into effect.
What he's saying: Just don't ask Buchanan to identify the local manufacturer who is supplying his CBD Joint stores in Minneapolis, Rochester and Isanti.
- " I don't want everybody else to know. I want to get my product because that's the problem right now. A lot of people don't have enough compliant (product)," he tells Axios.
What's happening: The legalization of edibles and beverages with up to 5 milligrams of THC has Minnesota businesses scrambling to understand the new regulations in hopes of reaping big profits.
- If opening weekend was any indicator, there's a huge demand for the edibles. Long lines formed outside tobacco and CBD shops and many retailers quickly ran out of product.
Why it matters: For local businesses, edibles present a big risk and potentially a big reward.
Indeed Brewing is developing a non-alcoholic seltzer infused with 2 mg of THC and 2 mg of CBD that co-founder Tom Whisenand hopes will hit the market Aug. 1.
- Indeed had already created a CBD-infused seltzer three years and it's using the same process to create its new THC product, called Two Good.
- The brewery plans to distribute wholesale to retailers and in to-go from its Northeast Minneapolis taproom
- A state regulator has suggested sales from breweries won’t be allowed; Whisenand believes otherwise.
Meanwhile, other manufacturers are in a wait-and-see mode.
Tina Rexing, owner of T-Rex Cookie Co., is interested in creating THC cookies, but she doesn't want to be on the "bleeding edge" of the rush.
- Rexing is looking at rules in other states that require bakeries to separate their normal bakery from their THC bakery, and she's not ready to invest in another kitchen.
Plus, it's not clear if banks and payment processors will allow deposits and purchases of THC due to federal laws.
- Buchanan's stores are only taking cash for now; Indeed intends to accept credit cards and to be able to make deposits into its bank.
Yes, and: Nearly everyone interested in THC expects the Minnesota Legislature to create more rules and regulations around THC next year, which further clouds the industry.
The bottom line: Rexing's been in talks with a CBD company that she could partner with to make products, but she is being patient. A bad batch of THC cookies could hurt her popular T-Rex Cookie brand.
- "It's a scary space to go into, because there are so many unknowns," she said.
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