What happens if states ignore the federal hemp THC ban?

OG article by MJBizDaily Staff

November 14, 2025

In a swift, shadowy congressional pivot, Sen. Mitch McConnell has orchestrated a hemp ban within a federal spending bill, signed by President Trump on November 12, 2025, threatening to obliterate the $28 billion U.S. hemp-derived cannabinoid sector that employs 325,000 and generates $13.2 billion in wages. Redefining hemp from a 0.3% delta-9 THC threshold to total THC per container—at a mere 0.4 milligrams—the law targets intoxicating products like gummies, vapes, and beverages, ensnaring even compliant CBD via contaminated intermediates. Effective November 2026, it risks 95% of the market, per industry warnings, while bypassing debate in a "must-pass" vehicle.

McConnell's push, opposed by Sen. Rand Paul who decried its devastation to farmers and retailers, echoes 1930s prohibitionist Harry Anslinger. Kentucky's hemp heritage—once a McConnell champion—now faces irony, as rural investments from 2021–2024 cycles teeter. Economist Beau Whitney laments, "The U.S. has capitulated the hemp market to the rest of the world," predicting acreage drops below 2014 levels, ceding ground to France and Morocco. THC beverages, thriving in non-dispensary channels like Target, hinge on hemp supply chains; marijuana's intrastate limits can't fill the void, even post-rescheduling.

Critically, multi-state operators (MSOs) lobbying for this ban—hoping to quash hemp rivals—exhibit myopia, ignoring how Schedule III rescheduling offers no panacea. It lifts 280E taxes and eases banking but demands DEA registration dispensaries lack, without interstate commerce or recreational pathways. Hemp's federal demise underscores fragile gains: state-legal marijuana persists despite prohibition, suggesting hemp's resilience via adaptation, advocacy, and state defiance. Whitney notes MSOs may suffer revenue hits, as many dual-sold hemp products.

This fumble forfeits unified reform, prioritizing short-term wins over national cohesion. With a phase-in year, stakeholders must audit contracts, secure financing, and build coalitions—lest internal rivalries doom broader progress. Federal sleight-of-hand erodes trust; vigilant, transparent policy is imperative to salvage hemp's promise and avert industry self-sabotage.