Proposed Federal Ban on Hemp THC Would Be 'Major Windfall for Illicit Market'

The NCIA warned against a return to prohibitionist policies.

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The National Cannabis Industry Association (NCIA) is warning that a proposed federal ban on hemp-derived THC would be devastating to legitimate businesses while creating new opportunities for the illicit market.

Language in the The Agriculture, Rural Development, Food and Drug Administration, and Related Agencies Appropriations Bill is specifically aimed at cutting out rules in the 2018 Farm Bill that allowed the hemp-derived THC market to flourish. The bill would, among other things, focus on "closing the hemp loophole that has resulted in the proliferation of unregulated intoxicating hemp products, including Delta-8 and hemp flower, being sold online and in gas stations across the country."

The NCIA said establishing clear regulations would be a better approach than "reinstating failed prohibitionist policies."

“Hemp-derived THC products are already widely available across the country. Despite legislators’ intent, this budget provision won’t change that fact, but it will ensure these products are made and sold without oversight, delivering a big win to the drug cartels at the expense of public health and safety,” said NCIA CEO and Co-founder Aaron Smith in a statement. “Congress should empower federal agencies to regulate these products responsibly, not double down on prohibitionist policies that have already proven to be failures both in practice and in the court of public opinion.”

The NCIA also pointed out that public support for cannabis reform continues to grow, while the total size of the U.S. hemp-derived cannabinoid market was estimated to be $28.4 billion in 2023, according to cannabis economics firm Whitney Economics.

"This is roughly the same size as the nation's craft beer industry — underscoring the scale and economic significance of this emerging sector," the organization said in a news release.

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