Rapid Regulatory Responses to the Surge in Hemp-Based Cannabis Beverages
Across the United States, states are swiftly moving to impose bans or tighten restrictions on the sale of hemp-derived cannabis drinks, which have experienced an unprecedented rise in popularity. This growth has occurred in a regulatory landscape that remains largely unregulated compared to traditional marijuana markets, prompting urgent legislative action.
The Rise of Hemp-Infused Beverages and Their Market Appeal
These beverages derive their psychoactive effects from hemp, a cousin of marijuana that contains minimal THC-the compound responsible for the euphoric high. Unlike marijuana, hemp with THC levels at or below 0.3% by dry weight is federally legal, allowing these drinks to be sold outside licensed dispensaries, sometimes even to minors in certain states. Industry insiders note that these products are attracting a diverse consumer base, including individuals exploring sobriety and craft beer aficionados seeking alternative social lubricants.
Legal Challenges and Legislative Efforts
The explosive growth of hemp drinks has led to a flurry of legal battles and legislative proposals. Over 80 bills aimed at regulating hemp beverages have been introduced in state legislatures this year alone, according to the lobbying firm MultiState. States like Alabama, Georgia, and Texas-home to significant hemp industries-have recently attempted to ban these intoxicating drinks. Meanwhile, Congress is also weighing federal restrictions.
“We need to rein in this situation,” remarked Texas State Senator Charles Perry (R) during a March hearing, emphasizing the need for regulatory control.
Understanding THC Levels in Hemp Products
Hemp is classified as such if its THC content remains at or below 0.3%. Any product exceeding this threshold is legally considered marijuana. However, industry experts warn that THC in hemp can be chemically modified or used in large quantities, making these beverages as intoxicating as higher-potency cannabis products.
“The key factor is the milligrams of THC permitted,” explained cannabis attorney Rob Kight. “Some hemp drinks contain 50 to 100 milligrams of THC, enough to produce a significant high, yet they are still legally labeled as hemp.”
Market Expansion and Economic Impact
Since federal legalization in 2018, the hemp beverage industry has expanded rapidly. Retailers and producers have become more comfortable with the legal landscape, leading to a market valued at over $1 billion this year-more than quadrupling from approximately $239 million in 2023, according to Euromonitor International. Industry analysts project that hemp-derived low-dose THC drinks could surpass craft beer sales nationwide by 2035, potentially reaching a $30 billion market within the next decade.
Insurance and Business Adoption
This spring, Frontier Risk, an insurance provider, began offering coverage specifically for venues serving hemp drinks, filling a gap left by traditional liability policies. Co-founder Peter Berg noted that, with proper safety protocols, these beverages are considered less risky than alcohol, leading to growing interest from event spaces and entertainment venues.
Industry Alliances and Calls for Standardization
Major players in both the alcohol and cannabis sectors have entered the hemp beverage arena, advocating for consistent regulations that mirror those governing alcohol and marijuana markets. Industry leaders argue that the current patchwork of laws creates confusion and uneven standards, which hampers legitimate businesses and fosters illegal activity.
Consumer Trends and Demographic Shifts
Hemp drinks are increasingly appealing to health-conscious consumers and those seeking alternatives to alcohol. As alcohol sales decline-partly due to health awareness-cannabis use has expanded among older adults. A 2023 study published in JAMA Internal Medicine revealed that 7% of adults aged 65 and older used cannabis in the past month, a sharp rise from less than 1% in 2005.
Market Penetration and Social Acceptance
Distributors like R.H. Barringer in North Carolina recognized the potential of hemp drinks early on, noting their appeal as low-calorie, lower-sugar alternatives to traditional alcoholic beverages. Their primary consumers tend to be individuals aged 30 to 50 who are reducing alcohol intake, but sales are also growing in college towns and retirement communities-markets where older adults may be on medications that interact negatively with alcohol.
Gary Goudelock, a 46-year-old from Des Moines, shared that he appreciates hemp drinks for their fewer physical downsides, such as dehydration, but primarily consumes them socially, depending on availability.
Broader Appeal and Market Competition
Experts suggest that hemp beverages have a broader consumer base than other cannabis products like vapes or edibles, largely because they are perceived as less intimidating and more socially acceptable. In Nashville, for example, Adam Sinks’s stores report that hemp drinks now rival craft beer sales, filling multiple shelves and becoming a staple in their soft drink and beer sections.
Concerns Over Safety and Regulation
Despite their popularity, critics raise concerns about the safety of hemp drinks. Some argue that these products can be dangerously intoxicating or contaminated, especially given the lax regulatory environment. Critics also point out that hemp drinks were inadvertently legalized in 2018, a law primarily focused on agriculture, which has allowed these products to proliferate alongside colorful, flavored vapes and gummies that appeal to children.
A case in point is April Ramos from Austin, who was alarmed when her 13-year-old son selected a pomegranate-flavored drink containing CBD-an non-intoxicating compound-at the grocery store. She chose not to purchase it, highlighting parental concerns about product transparency and safety.
Health Incidents and Regulatory Disparities
Data from America’s Poison Centers indicate over 1,520 THC-related poisoning cases in the past year, with more than half involving children and teenagers. Unlike marijuana, which is classified as a controlled substance and subject to strict regulations, hemp-derived products can be manufactured and shipped nationwide under federal law, often bypassing safety standards and taxation typical of regulated markets.
State-Level Restrictions and Industry Challenges
States like California and New York have implemented bans or restrictions on hemp drinks, while others enforce regulations such as third-party testing, THC limits, and age restrictions. Industry stakeholders are calling for uniform federal standards to prevent confusion and protect consumers. For instance, Iowa’s 2024 law capped THC per serving at 4 milligrams, forcing companies like Scott Selix’s Climbing Kites to recall products and incur significant financial losses-estimated at around $1 million-due to non-compliance.
Conclusion: Navigating a Rapidly Evolving Industry
The hemp beverage sector stands at a crossroads, balancing innovation and consumer demand with safety and regulatory oversight. As the industry continues to grow, policymakers, businesses, and consumers alike face the challenge of establishing clear, consistent standards that ensure product safety while allowing for market expansion. The coming years will be crucial in shaping the future landscape of hemp-infused drinks and their role in America’s evolving approach to cannabis and wellness.
