The hemp space has exploded over the last decade. From CBD oil to THC drinks, the hemp-derived cannabinoid market is valued at more than $38 billion. But with a federal hemp ban looming, new data predicts the potential impact — and how many businesses could close if it goes through.
A report from Whitney Economics suggests more than 70 percent of hemp businesses would shut down or relocate outside the U.S. if the new restrictions take effect.
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The federal policy could eliminate more than 225,000 jobs and cost states up to $2.1 billion in sales tax revenue.
Just 8.5 percent of hemp cannabinoid products would remain available for sale, the report predicts.
“The economic impact of the current hemp laws, if enacted, is rather profound,” the report states.
The federal definition of hemp is set to change on Dec. 11. Currently, hemp is federally defined as cannabis containing no more than 0.3 percent delta-9 THC by dry weight.
Under the new rules, finished hemp-derived cannabinoid products would be limited to 0.4 milligrams of total THC and certain other cannabinoids per container.
That change would mean the majority of commercial hemp products, including many CBD goods, would become federally illegal.
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Advocates hope the peer-reviewed report encourages Congress to move swiftly to regulate hemp ahead of the December deadline. Several hemp-related bills are circulating, but the clock is ticking.
Congress already passed a one-month delay of the ban, originally set to take effect Nov. 12.
President Donald Trump has been pressing lawmakers to enact policy to preserve access to full-spectrum CBD. Meanwhile, lobbyists for alcohol distributors are pushing for broad regulation of THC drinks, a booming product category.
It’s unclear whether any hemp-related legislation will pass in time, but industry advocates hope the new Whitney report serves as a wake-up call for lawmakers.
