Federal Ban on Intoxicating Hemp Products Gains Momentum

Strategic Insights -

A federal ban on intoxicating hemp products has gained traction in the US Senate and House of Representatives, with supporters citing concerns over the products' safety and deceptive marketing. The ban would effectively close the "Farm Bill loophole," which was created by the 2018 Farm Bill and has allowed hemp-derived THC products to flood the market.

The Senate and House measures, both of which have bipartisan support, would prohibit the sale of products containing delta-8 THC, a hemp-derived substance with psychoactive properties. Supporters argue that the ban is necessary to protect consumers, particularly children, from the dangers of unregulated intoxicating hemp products. Industry insiders, such as Ray Boyer, estimate that hemp has taken up to 50% of the marijuana market share away from state-licensed businesses.

Key Takeaways:

  • The Senate and House measures would ban the sale of products containing delta-8 THC, a hemp-derived substance with psychoactive properties.
  • The ban is supported by both Republican and Democratic lawmakers, including US Sen. Jeff Merkley of Oregon.
  • Intoxicating hemp products have been a competitive threat to licensed marijuana companies, with industry insiders estimating that hemp has taken up to 50% of the marijuana market share in some regions.
  • The 2018 Farm Bill created the "Farm Bill loophole," which allowed hemp-derived THC products to flood the market.
  • Industry groups, such as the American Trade Association of Cannabis and Hemp (ATACH), are concerned that the ban would be a "devastating blow" for US hemp companies.
  • A federal ban would likely require hemp businesses to pivot back to following state laws and regulations.
  • Several states have adopted tax- and-regulate schemes for intoxicating hemp businesses, similar to how most states have adopted regulatory systems for medical or recreational marijuana.

Statistics:

  • The intoxicating hemp product market was worth nearly $20 billion as of 2024, according to BDSA, a cannabis market research firm.
  • The national state-legal marijuana market has a value of $31 billion.
  • Industry insiders estimate that hemp has taken up to 50% of the marijuana market share away from state-licensed businesses.
  • 95% of all hemp products have a quantifiable amount of THC in them, including non-intoxicating full-spectrum CBD products.

Sources:

  • McConnell, M. (2025, July 10). Senate Appropriations Committee hearing on combating intoxicating hemp products.
  • Crain Communications Inc. (2025, July 20). "Federal ban on hemp products gains momentum in Senate."
  • Lindsey, C. (n.d.). American Trade Association of Cannabis and Hemp (ATACH).
  • Miller, J. (n.d.). U.S. Hemp Roundtable.
  • Boyer, R. (n.d.). Rooted Management Services.
  • Crawford, J. (n.d.). Ohio Division of Cannabis Control.