Beer Gets Burned, Hemp Drinks Heat Up

 New insights from Whitney Economics show hemp beverages could win big as tariffs slam the beer industry

The team at Whitney Economics just dropped their latest cannabis and hemp market forecast—and it’s a must-read for anyone watching consumer trends in 2025 and beyond.

According to their new analysis, the U.S. legal cannabis market is projected to hit $34 billion in 2025, up 13% from 2024. But that’s actually lower than what Whitney forecasted last year. Why the downgrade? Oversupply, high taxes, and competition from illicit and hemp-derived products are slowing growth across key adult-use markets like California, Illinois, and Washington.

But here’s where it gets interesting: while the cannabis market adjusts to pricing pressure and policy barriers, hemp beverages are accelerating—and tariffs may give them an unexpected tailwind.

As the Trump administration reimposes trade tariffs, the craft beer industry is taking a direct hit. Aluminum and stainless steel tariffs are pushing up costs for brewers, while international retaliation is hurting American hops growers. It’s a double whammy for an already-declining category.

Meanwhile, hemp-derived drinks are quietly gaining momentum, especially in states like Minnesota, Texas, and Tennessee. Whitney’s data shows a surge in market share for these products, driven by a new wave of consumer interest and expanding retail availability.

The takeaway? Hemp beverages could be the quiet winners of the trade war, capturing share from traditional alcohol and benefiting from cannabis consumers looking for affordable, functional alternatives.

At Highly Capitalized, we believe this trend is one to watch. For operators, investors, and policymakers—this isn’t just a shift in preference. It’s a sign that the next wave of cannabis consumption may be coming in a can.