Shutdown Bill Puts Hemp & THC Businesses at Risk. Photo by Kelly Hite.
NEW ORLEANS — A hemp and THC provision tucked into the bill that ended the nation’s longest government shutdown could devastate the multi-million-dollar cannabis-derived products industry. While the measure ensures that roughly 800,000 federal employees will receive back pay and extends SNAP benefits through September 2026, it also includes language that effectively bans many hemp-derived
NEW ORLEANS — A hemp and THC provision tucked into the bill that ended the nation’s longest government shutdown could devastate the multi-million-dollar cannabis-derived products industry.
While the measure ensures that roughly 800,000 federal employees will receive back pay and extends SNAP benefits through September 2026, it also includes language that effectively bans many hemp-derived THC products.
“If it becomes effective in a year, it would end all the products we currently have,” said Eric Becker, co-owner of Louie Louie, a New Orleans-based company that produces hemp-derived THC beverages sold in Rouses Markets and Total Wine stores across Louisiana and in retailers throughout Mississippi and Alabama.
Industry Pushback
Speaking from Boulder, Colorado, Arthur Massolo, executive vice president of the U.S. Hemp Roundtable, a national advocacy organization representing the hemp and cannabinoid industry, said, “Hemp businesses have been begging for regulation for many years, but this isn’t the right way to do it.”
Massolo, who has worked with national lobbying groups for more than a decade, explained that Senate Republican Leader Mitch McConnell and Representative Andy Harris, chair of the House Agriculture Subcommittee on Agriculture, inserted the restrictive language into the agriculture appropriations section of the government-funding bill.
“We were able to strike the McConnell language from the Senate appropriations bill but not the Harris language in the House,” Massolo said. “Senator Rand Paul went to bat for the hemp industry and wanted to strike this out because it is not the right forum.”
He noted the irony that McConnell was a key champion of hemp legalization under the 2018 Farm Bill, which established hemp as federally legal with less than 0.3 percent THC by dry weight.
Economic Fallout and the Fight for Revision
“The fig leaf handed to us is a one-year moratorium. The industry now has 365 days to lobby for revisions,” said Massolo.
For businesses that have built their models around hemp-derived THC beverages, that year may not be long enough.
The new law rewrites the federal definition of hemp and limits consumable hemp products to no more than 0.4 milligrams of total THC per container — a threshold far below the levels in most hemp-derived drinks and edibles currently sold. It also prohibits the unregulated sale of intoxicating hemp-based or hemp-derived products, including Delta-8 THC, at gas stations, convenience stores and online.
Supporters say the restrictions close a loophole in the 2018 Farm Bill that allowed intoxicating hemp-derived products to reach consumers, but industry leaders warn the language is so broad it could also eliminate most CBD products along with hemp-derived THC beverages and edibles.
According to the U.S. Hemp Roundtable, the new definition could “wipe out 95 percent of the nation’s $28.4 billion hemp industry.” A 2023 Whitney Economics study found that the hemp-derived products sector supports roughly 328,000 workers nationwide, generates $13 billion in wages, and contributes $1.55 billion in annual sales-tax revenue.
Louisiana’s Regulated Market
In Louisiana, Becker said, the hemp beverage market has already matured under strict oversight. “Our products are sold at Rouses and Total Wine — not at smoke shops or seedy places,” he said. “Teachers, CEOs of companies — they all consume Louie Louie. I’m a lawyer by training. Our industry is now tested, taxed, and regulated.”
He added that the state has implemented safety and age restrictions that could serve as a national model. “It was a bumpy road in 2024, but we now have a well-regulated product market for these beverages,” Becker said. “Total Wine is a huge national business that wouldn’t sell our beverages if we weren’t licensed. Our products require Department of Health permits and operate under the Louisiana Office of Alcohol and Tobacco Control guidelines for retailers. As a state, we’ve already solved the supposed problems — like the 21-and-older rule.”
Under the new language, nearly all hemp-derived THC products would become illegal in late 2026, effectively re-prohibiting much of the market that grew following the 2018 Farm Bill.
Shifting Consumer Trends
Massolo said the bill also arrives as consumer habits are changing. “Suppliers of alcohol — especially bourbon and beer — aren’t in favor of hemp products because they take up shelf space,” he said. “At the same time, distributors are selling these products and realizing people aren’t drinking as much alcohol. They’ve replaced those sales with THC drinks and gummies. There have been no recorded cases of THC overdose.”
Industry data backs that trend: sales of THC-infused beverages and edibles are rising as consumers seek lower-alcohol or alcohol-free options. "People who no longer drink alcohol have told me that, with Louie Louie, they can rejoin the crowd at the bar and celebrate events like Mardi Gras without feeling left out," said Becker.
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