Texas’ estimated $5.5 billion market in hemp-derived THC is in mortal danger after the state House approved a blanket ban on intoxicating products.
The ban, pushed by Lt. Gov. Dan Patrick and approved by the state Senate in March, passed the House by a 86-53 vote on Wednesday night.
Though a final House vote on Senate Bill 3 is scheduled for Thursday, it’s expected to pass and the ban is likely to be signed into law by Gov. Greg Abbott, according to the Houston Chronicle.
“We are banning high,” Republican state Rep. Tom Oliverson said, according to the Dallas Morning News.
“If it gets you high, it is not legal anymore.”
‘Dismantles the legal hemp industry’ in Texas
The Texas Hemp Business Council lamented the bill, saying in a statement that the measure “dismantles the legal hemp industry and ignores the voices of small businesses, farmers, veterans and consumers across the state who rely on hemp-derived products for their livelihoods and well-being.”
“Despite overwhelming testimony and clear data demonstrating the safety and economic value of federally legal hemp-derived cannabinoids, lawmakers have chosen a path that eliminates an entire sector of our economy, one that generates $4.3 billion in retail sales, 53,300 jobs and $268 million in tax revenue.”
Estimates of the size of the Texas market vary, but annual revenue from as many as 8,500 retailers across the state likely exceeds $5.5 billion, according to an analysis from Oregon-based Whitney Economics.
It’s not yet clear what recourse hemp interests in the state might have or whether litigation would temporarily block implementation of the ban if Abbott signs it into law.
Texas ban follows California
After years of hemp-derived THC drinks, gummies and smokable THCA flower proliferating across Texas – and creating what’s understood to be the biggest U.S. market for hemp-derived THC products – Patrick introduced what’s considered to be one of the country’s strictest bans.
That follows other states that have moved to close the “loophole” created by the 2018 Farm Bill.
Texas’ move to ban intoxicating hemp products via the state Legislature follows California Gov. Gavin Newsom’s emergency ban on hemp-derived THC imposed last fall.
Of the country’s biggest markets for hemp, only Florida remains.
There, lawmakers failed to pass any regulations this year, one year after Gov. Ron DeSantis vetoed a de facto ban on intoxicating hemp products.
Texas’ new law would allow for some nonintoxicating products containing CBD, according to text of the bill.
However, the law:
- Effectively outlaws products with delta-8 THC and delta-9 THC.
- Massages the definition of THC in the state to close a so-called THCA loophole that merchants in some other states use to sell marijuana under the claim that it’s federally compliant hemp.
Trouble for entire U.S. hemp sector predicted
Added to the actions taken in other states, Texas’ ban threatens the nascent hemp-derived THC industry nationwide, said Thomas Winstanley, the executive vice president of Edibles.com, which launched earlier this year.
“Senate Bill 3 may aim to address a real consumer health issue in Texas, but the solution it proposes is not only misguided – it’s a cure worse than the disease,” Winstanley said in a statement.
“This isn’t just a Texas issue – it’s a national one. The precedent set here will send shockwaves across the country.”
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