Navigating the Hemp vs. Cannabis Battle: The Future of Edibles and Drinks

Continued dialogue from CANNABUFF magazine issue 20, Summer 2024

Cannabuff Magazine • Issue 20 • Summer 2024

The cannabis industry has long been a complex landscape, full of regulatory challenges and changing legislation. One of the most contentious issues is the exploitation of the THCA loophole, which has allowed hemp-derived products to skirt THC regulations. However, with new legislation on the horizon, the industry is poised for significant changes. While the closure of the THCA loophole spells the end of an era for some, it opens up new opportunities for others, particularly for national lifestyle based brands who can cross-over into the realm of edibles and drinks, organically.

The End of an Era: THCA Loophole Closing

For years, brands like Cookies and Stiiizy have capitalized on the THCA loophole, marketing products that convert to THC through heating. This clever maneuver has allowed them to tap into a booming market, but it does appear this loophole is on its way out. Recent lawsuits and legislative moves will close this gap, forcing the industry to adapt quickly.

The Rise of Edibles and Drinks

Despite these impending changes, there is a silver lining for certain segments of the market. Edibles and drinks, which operate under the hemp loophole by leveraging the total weight calculation for delta-9 THC, are well-positioned to maintain their branding and market presence across states. Unlike vape products and flower—which face significant risks and regulatory challenges—edibles and drinks can openly exploit the loophole without the same level of scrutiny.

The total weight calculation allows these products to remain compliant while still delivering the desired effects to consumers. This has created a fertile ground for innovation and branding, as these products can be sold outside dispensaries, reaching a broader audience.

Challenges and Predictions

While the future looks bright for edibles and drinks, the industry is not without its challenges. The alcohol lobby, a powerful force compared to the relatively young cannabis industry, poses a significant threat. As cannabis and hemp continue to vie for market dominance, we can expect to see a series of battles at the state level. Some states may move to ban certain hemp-derived products altogether, but it’s likely that most will not.

The real winners in this evolving landscape will be those who play by the tightening rules, get licensed, and build compliant businesses. This transition will be painful for some, but it’s a necessary step towards long-term stability and success.

Final Thoughts

The era of structured compliance presents new opportunities, especially for edibles and drinks. These products are uniquely positioned to thrive, leveraging the hemp loophole while maintaining strong branding and market presence.

The cannabis industry is entering a new phase, one where compliance and innovation go hand in hand. Those who can adapt to the changing regulatory landscape will be well-positioned for success in the years to come.