Minnesota's marijuana market took a small but crucial step toward next year's launch Wednesday as the state released a first draft of regulations.

The Office of Cannabis Management's proposed rules include potency limits and other technical requirements for growers, retailers and processors the state law didn't cover.

While some social equity applicants are beginning their process and dispensaries have opened on several Native American reservations, the rulemaking process needs to finish before the full application process can kick off, which should happen early next year. Minnesota legalized marijuana possession one year ago.

Among the notable proposals:

  • Production limits will apply to different license holders and restrict how much cannabis they can process per year. A microbusiness can process 3,000 pounds of marijuana; mezzobusinesses can handle 10,000 pounds; general manufacturers can process 20,000 pounds, and combination medical licensees can produce 50,000 pounds.
  • Potency limits will apply to concentrates (70% THC) and topical products (1,500 milligrams THC).
  • Cannabis manufacturers can purchase products from tribal businesses, which will help increase early retail supplies while state-licensed growers are setting up.

The public can comment through Aug. 30. A final draft of the rules should come by the end of the year, which will create another chance for comments.

Then applications can open, and the state can start building what many expect to be a $1.5 billion market by the end of the decade.

The state's Office of Cannabis Management has grown to more than 75 employees after launching with just one staffer last year.

Charlene Briner continues to serve as the office's interim director until Gov. Tim Walz names a permanent one. Walz's first pick for the job resigned a day after her appointment last fall.

Sign up for Nuggets, our free weekly email newsletter about legal cannabis in Minnesota.