Trump’s tariffs, on and off, have roiled many industries. Among them, the regulated cannabis sector, which will suffer as vape equipment and packaging costs are affected with new tariffs for shipments coming from Asia. According to Whitney Economics’ new report, hemp beverages could be the segment that benefits.
Other parts of the chain, including the domestic market, are not as affected by the tariffs. You can also add the growing popularity of these products to the winning combination.
Hemp beverages have taken the beverage market by storm. While states are looking to ban hemp-based products that can be intoxicating, major distributors continue to stock them. Some states even make exceptions for beverages when they ban intoxicating hemp products.
According to Whitney Economics analyst Beau Whitney this all happens as the craft beer industry struggles. The alcohol industry has seen a decline in sales and craft beer’s once hot trend is now fading. Brewers Association records 399 closures compared with 335 newly opened breweries in 2024. Brewers have another problem with the latest tariffs.
Whitney pointed out that in addition to aluminum cans used for beer, stainless steel is also subjected to tariffs. This material is often used in the brewing process. Hops are another important ingredient for beer businesses. They are subject to tariffs.
Whitney writes, “On one hand, Trump’s new tariffs might represent a major upside for the hemp beverages industry. This sector has seen a strong increase in growth over the past few years.” Hemp beverages are filling in for alcohol and beers as sales of both decline. “The popularity of hemp-cannabinoid drinks is only at its beginning.”
Whitney Economics notes that hemp beverages have grown in popularity, particularly since Minnesota opened its market in 2022.
Whitney, in her recent newsletter, wrote that “Recent studies in Texas, Illinois, and Tennessee show hemp drinks are increasing their market share with hemp distributors, manufacturers, and retailers.”
Hemp-based beverages are usually more expensive than craft beer. The price of four packs of infused seltzers can vary from $9.99 to $15, while the cost of a 12 pack of craft beers is usually $20 or less. As craft beer manufacturers raise their prices due to increased costs, hemp drinks will not be so costly.
As hemp beverages fight to stay legal in many states, they get one benefit in the form avoiding tariffs.