Hemp Industry Braces for Federal Redefinition and Potential Prohibition

The hemp industry is facing a critical moment as a federal redefinition of hemp is set to take effect in November 2026, potentially rendering many hemp-derived THC products illegal. This impending change has prompted businesses like The Georgia Hemp Co., led by Joe Salome, to strategize on how to navigate the looming prohibition. Salome, who once had aspirations of expanding his THC beverage line into major retailers, is now focused on maximizing sales before the regulatory shift occurs

Salome's company had been poised for significant growth, leveraging its partnership with Major League Baseball's Atlanta Braves as an official CBD partner. However, the federal redefinition threatens to disrupt the $28.3 billion national hemp industry, as it will close the loophole created by the 2018 Farm Bill that allowed certain hemp-derived THC products to flourish. The change has put expansion plans on hold for many, including The Georgia Hemp Co., which had been eyeing distribution through major grocery chains

Industry leaders and advocates are not giving up without a fight. Jake Bullock, CEO of the low-dose hemp-based THC beverage company Cann, views the situation as an opportunity rather than a ban. Bullock, who is actively lobbying Congress, believes that the year-long grace period is a chance to establish favorable regulations that could allow hemp beverages to remain on the market. He remains hopeful that the rules will distinguish between low-dose beverages and more potent products like superpowered gummies and THCA flower

The regulatory landscape for hemp is complex and fraught with challenges. The U.S. Food and Drug Administration is expected to release guidance on permissible cannabinoids within the next three months, which could provide some clarity for the industry. However, the uncertainty has already led some states to consider tightening their own hemp regulations, as seen in Illinois where Governor JB Pritzker has signaled a potential ban on intoxicating hemp products

Looking ahead, the hemp industry is preparing for a dynamic year of adaptation and potential pivots. Companies like The Georgia Hemp Co. are considering various strategies to remain viable, such as shifting focus to products that might remain legal under new regulations. Vince Sliwoski, a cannabis-focused attorney, suggests that businesses in states with regulated hemp industries may have a better chance of survival compared to those operating online without state oversight

The broader implications of the federal redefinition are still unfolding, with many in the industry taking a 'wait and see' approach. While some operators are preparing for the worst, others are hopeful that advocacy efforts will lead to a more favorable regulatory environment. The outcome will depend on the actions of federal regulators, state governments, and the hemp industry itself as they navigate this period of uncertainty

Despite the challenges, industry insiders like Salome remain cautiously optimistic. He believes that while some brands may not survive the regulatory changes, the hemp industry as a whole will adapt and endure. Salome has prepared his business for potential disruptions by including clauses in leases and contracts that allow for flexibility in response to regulatory shifts. This strategic foresight may prove crucial as the industry braces for what lies ahead