Rope Vs. Dope

The Hemp Wars Heat up.

Daily Recap

The U.S. Congress is caught up in a political haze over what to do with hemp. In 2018, Congress was told that hemp laws were for “rope, not dope,” but the hot debate these days is all about intoxicating hemp-derived dope.

The argument that hemp intoxicants should remain unregulated and a sub-sector that Congress never intended to create can continue to operate unchecked is as contested as the other cannabis reform efforts in Washington, D.C.

Order in the Court

A U.S. appeals court ruled that hemp-derived cannabinoid THC-O-acetate is federally legal under the 2018 Farm Bill, rejecting the position of the DEA that the chemical is a Schedule I controlled substance.

In rejecting DEA’s 2023 interpretation of the law, the Fourth Circuit panel sided with an earlier opinion out of the Ninth Circuit Court of Appeals that ruled the Farm Bill’s legalization of hemp removed restrictions on a wide range of cannabinoids.

Cali Hemp

Governor Gavin Newsom of California today issued proposed emergency regulations to protect youth from the adverse health effects of dangerous hemp products.

The new regulations require industrial hemp food, beverage, and dietary products intended for human consumption to have no detectable THC or other intoxicating cannabinoids per serving, create a minimum age to purchase hemp products to 21, and limit the number of servings of hemp products to five per package.

Cali Sober

Financial analysts expect the expansion of the marijuana legalization movement will continue to post a “significant threat” to the alcohol industry, citing survey data that suggests more people are using cannabis as a substitute for alcoholic beverages.

A report from Bloomberg Intelligence (BI) projects that slumping sales of wine and spirits “may extend indefinitely,” which “stem largely” from the increased consumer access to “legal cannabis,” as well as rising popularity of made-to-go drinks.

Stocks & Stuff

Wall Street came for sale today as the S&P suffered its worst week since March ‘23 and market historians braced for what traditionally arrives after rate cuts begin.

U.S. cannabis, meanwhile, continued to shadow box in the pay-no-mind club, with MSOS losing a shade under 3% (+1.5% for the week) on $39 million total notional.

Below, we’ll top-line the landscape, measure the substitution effect of cannabis for alcohol, count the green votes up for grabs, quantify the Virginia impact on AYR, channel check canna prices and offer random thoughts on the broader tape.

All that and more, just scroll down.

SPY 0.00%↑ QQQ 0.00%↑ IWM 0.00%↑ MSOS 0.00%↑ ETF Notional: $39M

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