Quick Take
Craft breweries in Minneapolis are now whipping up cans of THC‑infused seltzer to keep sales from slipping. The drink—packed with the same psychoactive compound that gets people high from marijuana—has helped businesses like Indeed Brewing survive a shrinking beer market.
But a clause buried in the bill that closed the federal government shutdown this month will soon outlaw those drinks. The ban, set to take effect in 2026, threatens to hit the $24 billion hemp industry and any brewery that sells THC‑laced beverages.
Seltzer, Big Trouble
When the production line at Indeed Brewing “moved quickly,” the cans were no longer filled with beer but with THC‑infused seltzer. The ingredient that delivers the high has become a lifeline for brands that’ve seen alcohol sales tumble.
“It’s a big deal,” said Ryan Bandy, chief business officer at Indeed. “It would be a mess for our breweries, for our industry, and obviously for a lot of people who like these things.”
The federal trap was a provision that bans all “impairing beverages and snacks made from hemp,” a sweeping move that will shut down the burgeoning market for THC‑drinks and hemp‑based snacks. The change sits inside the legislation that ended the 43‑day shutdown and will be enforced on New Year’s Day in November 2026.
The 2018 Opening
Marijuana and hemp come from the same plant. The main difference is that marijuana is bred for high THC levels, while hemp is grown for its fibers and low‑THC byproducts. A 2018 farm bill finally allowed farmers, including those in Kentucky—home to Senator Mitch McConnell—to grow industrial hemp.
However, the law defined hemp as containing less than 0.3 % of delta‑9 THC. This spelling out left a huge loophole: producers could keep the delta‑9 level low while still injecting flavorful or potent forms of THC, like delta‑8 or delta‑10. The result was a flood of vape oils, gummies, chips, cookies and sodas with enough THC to alter the mind.
The lack of regulation meant those products were sold freely, even to teens, at gas stations and convenience stores across the country. In legal marijuana states, they competed with taxed and controlled products, and in other states they slipped past bans on recreational weed.
State‑by‑State Patchwork
Since the 2018 bill, states have responded in their own ways:
- California – Governor Gavin Newsom outlawed intoxicating hemp products outside California’s legal marijuana system.
- Texas – With the largest hemp market, the state is tightening sales of impairing hemp, limiting it to adults over 21.
- Nebraska – Lawmakers are debating criminalizing any sale or possession of hemp‑based THC.
- Washington – The state cut its approved hemp growers from 220 to just 42 in 2024 after banning smokable hemp.
- Minnesota – Legalized THC drinks for those 21+ in 2022, and the products are popular enough that major retailers like Target now stock them.
- Small Breweries – The city of Minneapolis sees breweries like Indeed and Bauhaus Brew Labs each getting about a quarter of their revenue from THC drinks.
The Senate’s Close‑The‑Loop Move
Senator McConnell didn’t intend the 2018 farm bill to create a harmful hemp product market. Years later, he inserted a federal “hemp THC ban” into the shutdown‑ending bill to eliminate “dangerous” items while keeping industrial hemp and CBD legal.
“The ban will keep these dangerous products out of the hands of children, while preserving the hemp industry for farmers,” McConnell told reporters. “Industrial hemp and CBD will remain legal for industrial applications.”
Proponents of legal marijuana welcomed the ban as an end to unfair competition, and anti‑drug advocates argued that no good reason existed to allow such products. Critics, however, argue that a one‑year sunset period gives the industry time to adopt better regulations—like banning synthetic THC, setting age limits, and preventing advertising to kids—rather than shutting down the whole sector.
“We’re very hopeful that cooler heads will prevail,” said Jonathan Miller, counsel for the U.S. Hemp Roundtable. “If they really thought there was a health emergency, there would be no year‑long period.”
The Cost and the Stakes
The federal ban could wipe out more than 300,000 jobs and cost states about $1.5 billion in lost tax revenue, according to industry estimates. Drew Hurst, president and COO of Bauhaus Brew Labs, sees his company as a prime target: “If this goes through as written currently, I don’t see a way at all that Bauhaus could stay in business,” Hurst said.
What’s Next?
Lawmakers are now debating whether to roll back the ban or find ways to regula‑tate the hemp THC market:
- Senator Rand Paul attempted to remove McConnell’s language from a key funding bill but failed by a 76‑24 margin.
- Senators Amy Klobuchar and Tina Smith of Minnesota have said the federal government could let states build their own regulatory frameworks, citing Minnesota’s strict regulations as a potential national model.
- Kevin Hilliard of Insight Brewing in Minneapolis hopes for clearer rules before this spring’s planting season. “If a farmer has uncertainty, they’re not going to plant,” Hilliard said.
The industry’s future will depend on whether lawmakers can craft sensible rules that protect consumers—especially children—while preserving jobs and the growing hemp economy. The timing and shape of those regulations remain to be seen.
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