President Donald Trump late Wednesday signed a spending bill that had previously received approval from both chambers of Congress, ending the 43-day government shutdown, and, in the process giving a federal stamp of approval to a ban on hemp-THC products that have recently emerged as a major growth channel in convenience stores, grocery stores and restaurants.
The provision banning hemp-derived THC drinks, gummies and other items was slipped into the federal funding bill just before the Senate voted on it Sunday. Sen. Rand Paul (R-Kentucky), whose state has a large hemp-growing industry, wrote an amendment to the bill, but it failed. Paul’s fellow senator, Mitch McConnell (R-Kentucky), added the language to the funding bill that would ban all hemp products with more than 0.4 milligrams of psychoactive tetrahydrocannabinol, or THC, per container, saying the move was intended to protect minors from accessing the products.
Under the legislation, hemp-THC suppliers and distributors now have one year before the full ban is enforced, unless the law is changed before that time.
Diana Eberlein, who lobbies on behalf of the low-dose THC industry in her role as chairperson of the Coalition for Adult Beverage Alternatives, called the 365-day implementation rule “a lifeline, an opportunity.”
“It is not ‘the end,’” Eberlein said in a LinkedIn post. “It is a runway.”
She urged those who care about preserving the industry to mobilize to work to build a “durable regulatory structure.”
The ban closes what some viewed as a “loophole” in the 2018 farm bill that allowed for the nationwide sale of products containing 0.3% hemp-THC by weight.
In the years since, the segment has grown into an estimated $28.3 billion industry, with hundreds of suppliers producing seltzers, sodas, shots, spirit analogues, gummies and more containing low doses of THC. Not to be confused with items sold in dispensaries in states where marijuana legal, these products can be sold in c-stores, grocery stores, restaurants, bars and via direct-to-consumer channels in dozens of states that allow them. Most contain anywhere from 2 milligrams to 10 milligrams of intoxicating THC per serving.
C-store giant Circle K recently started selling hemp-THC beverages in Georgia and Florida, with plans to expand to more states.
“We believe this is going to be huge,” Rebekah Stevenson, Circle K’s head of packaged beverage, said last month at the NACS Show in Chicago.
Big box retailer Target last month started testing a selection of hemp-THC drinks at a small number of Minnesota locations.
In May, the National Restaurant Association hosted a “hemp pavilion” for the first time at its annual trade show in Chicago.
As alcohol use has declined, more consumers have made the shift to THC. Last year, daily and near-daily marijuana users surpassed regular alcohol drinkers, according to a Carnegie Mellon University analysis of more than 40 years of national survey data.
In the immediate aftermath of the bill’s passage, hemp-THC suppliers and others are weighing next steps. Some have said they are looking at pivoting to selling products infused with mood- and health-boosting adaptogens. Some smaller companies likely will not have the financial resources to withstand the period of uncertainty.
Others are continuing to lobby for federal regulations on the products, in the same manner as alcohol, tobacco and other age-restricted items, in hopes of reversing the ban, saying a full prohibition on hemp-THC will only serve to open the door to bad actors who produce high-potency, un-tested products.
“Millions of adults across the country have made it clear they want balanced, non-alcoholic options for social enjoyment, including low-dose THC beverages,” Angus Rittenburg, CEO and co-founder of hemp-THC seltzer brand WYNK, said in a statement. “The demand is real, and growing. Our industry has responded by creating safe, transparent, rigorously tested products sold through age-gated retail … We strongly support sensible, science-based regulation.”
Members help make our journalism possible. Become a Restaurant Business member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.