Dive Brief:
- A bipartisan group of lawmakers introduced a bill to leave regulation of hemp-derived products up to states, the latest move to safeguard the fast-growing THC beverage industry ahead of a federal ban this fall.
- Called the Hemp Safety Enforcement Act, the measure would give states the option to allow hemp-based THC products by opting out of the federal ban. States opting out would still need to ban synthetically produced THC products and set a purchasing age minimum, setting up a system similar to recreational marijuana, whereby states can legalize sales despite a federal ban.
- The proposed legislation is the latest salvo to work around a ban on intoxicating hemp products set to take effect this November, closing a loophole that allowed beverage manufacturers to sell products with low doses of THC.
Dive Insight:
Since lawmakers moved to close a key loophole last fall, THC beverage companies have scrambled to prepare for the looming ban. Lobbyists and hemp companies have also worked together to propose a deadline extension, as well as other legal remedies.
The hemp industry generates $28.4 billion in economic impact, according to the U.S. Hemp Roundtable, and consumer interest in hemp products continues to increase as more drinkers move away from alcohol and toward other alternatives.
Since the ban was introduced, several THC beverages companies including Cann, Nowadays and Cornbread Hemp saw sales increase. The overall THC beverage category has grown 128% year over year, according to NIQ research, due to growing consumer interest as well as new product launches.
The new Hemp Safety Enforcement Act was introduced by Sens. Rand Paul, Amy Klobuchar and Joni Ernst. Multiple states have already moved to ban intoxicating hemp on their own, including Oklahoma and Ohio.
In a town hall on April 14, Paul said hemp products should be regulated like alcohol or any other substances that have the potential to be abused. The measure would be attached to the Farm Bill, which currently awaits a House vote after three years of delays.
“Half the states have already set up their own smart rules, THC limits, age restrictions, and safety standards that let hemp farmers grow, manufacturers innovate, and consumers stay safe,” Paul said in a statement. “Washington shouldn’t wipe out those efforts or destroy jobs and access to products that help our veterans, our elderly, and families across the country.”
