Key Points:
- The looming federal ban on intoxicating hemp drinks is likely to stay in place after lawmakers decided not to delay or overturn the restrictions set to take effect in November.
- The House voted to keep the ban as part of the Farm Bill, closing a loophole that allowed producers to manufacture hemp products in states with strict marijuana regulations.
- The bill will now go to the Senate, where changes to the restrictions could still be considered, including a proposal from Sen. Rand Paul to allow states to “opt-out” of the ban.
Insight:
The federal ban poses a threat to the growing hemp THC beverage industry, popular among consumers looking for a buzz without alcohol. Major retailers like Target and DoorDash have expanded their offerings in this market, estimated at $1 billion.
Hemp-based beverages with lower THC doses are favored for socializing without the hangover. Producers are advocating for federal age restrictions, third-party testing regulations, and caps on THC content.
The alcohol industry is monitoring the situation closely, as hemp-based THC products could potentially impact beer sales. Boston Beer CEO Jim Koch expressed concerns about the ban affecting the industry’s future.