Alcohol Distributors Join the Fight to Protect Hemp-Derived THC Beverages

Close-up of Lumen Regenerative Hemp beverages on sale in a store in San Ramon, California; the Hemp Farming Act of 2018 legalized hemp-derived products in the United States, July 11, 2019. (Photo: Smith Collection/Gado/Sipa USA)(Sipa via AP Images)

A coalition of more than 50 alcohol distributors is urging Congress leaders to protect the future of hemp-derived THC drinks in the United States.

In a letter published on Wednesday, distributors joined a chorus of industry veterans voicing support for the so-called “hemp loophole,” a stipulation in the 2018 Farm Bill that legalized consumables with less than 0.3% THC by dry weight. The rule, pushed for by then-Senate Majority Leader Mitch McConnell, was originally intended to support fiber and grain farmers in Kentucky. It has since taken on a life entirely its own. The hemp-derived THC market is now a multi-billion-dollar industry, available by way of gummies, flower, vapes and tinctures at retailers across the nation.

Hemp beverages have emerged as one of the most popular options, and alcohol distributors, one of their biggest benefactors. In a letter penned to Congress leaders Mike Johnson, Hakeem Jeffries, John Thune and Chuck Schumer, a coalition of distributors organized under the Hemp Beverage Alliance implored leadership to regulate, not criminalize, the fast-growing industry.

“As demand for alcohol has shifted downwards in recent years, hemp products have created jobs, driven new investment, and helped us meet changing consumer demand,” the letter reads. “If prohibition is enacted, that demand will not disappear—it will simply move into unregulated channels, undermining both public health, safety and legitimate businesses.”

The letter draws a timely parallel to the 18th Amendment, claiming that the “ensuing 14 years of prohibition only created a thriving illicit market and a significant number of bad actors.”

“Our forefathers realized the only way to eliminate these bad actors was to establish a robust regulatory framework where each State was given the authority to regulate products safely within its borders in a manner that respected the ethos of the citizens,” the letter adds.

The letter did not disclose the names of the alcohol distributors who co-signed on the statement. In a telling indicator of the size and scale of the industry, it could have been just about any. Leading distributors like Southern Glazer’s, RNDC and Reyes Beverage Group have all begun carrying hemp drinks over the past few years. The letter says that the collective operations of its cosignatories represent over $13 billion in revenue, 20,0000 employees and 26 states.

In September, eight Democratic senators penned a similar letter to Congress, advocating for a regulatory framework to protect the over 320,000 jobs currently employed by the hemp industry.

The senators laid out a proposed framework for federal oversight, including the restriction of sales and possession to adults over the age of 21, a ban on synthetic and “look-alike” products and requirements for third-party testing.