Hemp industry hit hard by new THC ban

The US hemp industry is preparing for layoffs, production cuts, and billions in lost revenue after Congress approved a funding bill that bans most hemp-derived consumer products.

The new rule limits products to no more than 0.4 milligrams of total THC per container, a level industry leaders say will wipe out 95% of the $28 billion retail market within a year.

Hemp was legalized in 2018 for industrial uses, but loose definitions allowed companies to sell gummies, drinks, and vapes with psychoactive effects. A typical gummy contains 2.5–10 milligrams of THC, far above the new cap.

According to lawmakers, psychoactive hemp is dangerous as youngsters can easily procure it. They argue that it is easy to alter the drug to increase its potency.

Industry groups warn that over 300,000 jobs, ranging from farming to retail, are now at risk. States with robust hemp sectors, such as Kentucky and Texas, could face significant economic repercussions. 

Executives say the crackdown will push demand into the black market, creating safety and enforcement challenges.

Many in the industry are now urging Congress to replace the ban with federal standards for testing, labeling, and age restrictions.