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President Donald Trump’s on again, off again tariffs have rattled many industries, including the regulated cannabis industry that will be affected as vape hardware and packaging prices get hit with tariffs in shipments from Asia. But according to a new report from Whitney Economics, one segment could actually benefit: hemp beverages.
While hemp beverages are sold in aluminum cans and will face increases in container costs from the tariffs, other parts of the supply chain are less affected by tariffs and the products are sold domestically. Add to that the surging popularity of the products, and you have a winning formula.
Hemp drinks have hit the beverage industry by storm. Major distributors are stocking them even as states look to ban intoxicating hemp products. Some states are even carving out exceptions for the beverages in those proposed bans.
Another advantage, according to Whitney Economics analyst Beau Whitney, is that all of this is happening as the craft beer business struggles. Alcohol consumption has been experiencing declines in sales, and the once-hot trend of craft beers is already looking like the moment is fading. The Brewers Association recorded 399 closures in 2024 compared to 335 new breweries, indicating a shift in the industry’s trajectory. The latest tariffs are adding another headache for those brewers.
In addition to the aluminum used in cans, Whitney noted that beer companies also face tariffs on stainless steel, which is used in brewing equipment. Beer businesses are also dependent on hops, which are also tariffed.
“On the other hand, the Trump tariffs could represent a significant upside opportunity for the hemp beverage industry, which has been experiencing strong growth for several years now,” wrote Whitney. “As alcohol and beer sales decline, hemp beverages have filled in the gaps in demand. The popularity of hemp cannabinoid beverages is just at the beginning of its ramp.”
Whitney Economics noted that the hemp beverage sector has come on strong, especially since the market opened up in Minnesota in 2022.
“Recent surveys in Texas, Illinois and Tennessee indicate that hemp beverages are capturing an increasing amount of market share among hemp retailers, distributors and manufacturers,” Whitney wrote in a recent newsletter.
Hemp beverages tend to be more expensive than craft beers. A four-pack of infused seltzer can range from $9.99 to $16, while a 12-pack of craft beers often runs $20 or less. If the craft beer makers raise their prices in response to the increased expenses from tariffs, hemp beverages no longer look quite so expensive.
So, while hemp beverages are fighting in various states to keep from getting banned, at least the group gets one gift in the form of avoiding most tariffs.
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