Ohio, Texas, and South Carolina Implement Divergent Hemp Restrictions Amid National Market Shift

State lawmakers across Ohio, Texas, and South Carolina are taking sharply different approaches to regulating the hemp market, signaling a new era of divergent policy responses to intoxicating hemp products. While Ohio has enacted a sweeping ban on products like THC and CBD beverages, South Carolina is pursuing a restrictive but not prohibitive model, and Texas is targeting the popular smokable hemp category with bans and increased fees. These moves reflect a growing consensus that the 2018 Farm Bill loophole around hemp-derived intoxicants has become too significant to ignore, but consensus ends there, as states carve out their own regulatory paths

In Ohio, the failure of a referendum campaign to block Senate Bill 56 allowed a comprehensive ban on intoxicating hemp products to take effect on March 20. This law not only prohibits a range of hemp-derived beverages but also alters the state's marijuana framework, creating what observers describe as a market reset. According to local coverage, hemp advocates fear the law could shutter thousands of businesses and eliminate jobs. Joey Ellwood, an Ohio hemp farmer, warned that "roughly 6,000 Ohio businesses could be affected." Litigation is already underway, with companies like Saucy Seltzer and Uncle Arnie’s seeking emergency relief and challenging the governor’s vetoes related to THC beverages

South Carolina has opted for a less draconian route, choosing to contain rather than ban hemp THC products outright. The state Senate approved a compromise bill that maintains legality for certain low-dose THC beverages, provided they are sold under tighter restrictions. These products, limited to 5 milligrams of THC or less, must now be kept behind the counter and sold only by licensed retailers. Meanwhile, higher-potency items are relegated to liquor stores, and on-premises sales in bars and restaurants are prohibited. This approach, as local outlets noted, is neither broad legalization nor absolute prohibition, but a clear move to "channel and control" the market

Texas, meanwhile, is preparing to implement some of the strictest measures yet, focusing on the smokable hemp and THCA flower market. New rules from the Texas Department of State Health Services, effective March 31, will ban the sale of these products by changing how THC is measured—now including THCA in the total calculation. This is a significant blow to retailers, as smokable products account for a majority of sales for many businesses. As one San Antonio operator told KSAT, "70% of their sales come from smokable products." In addition to product bans, the state is also imposing steep annual fees, up to $5,000 for each retail location and $10,000 per manufacturing facility, affecting over 9,100 registered hemp retailers

The contrasting strategies of these three states highlight a broader national trend: there is no unified direction for hemp regulation in the U.S., and the market is increasingly fragmented. Some states are embracing prohibition, others containment, and some are targeting specific categories with aggressive regulation. From the OG Lab newsroom perspective, this patchwork approach will likely accelerate as more states grapple with the political and economic realities of intoxicating hemp. Industry participants should expect continued volatility, with regulatory landscapes shifting rapidly and the balance between safety, access, and market viability remaining hotly contested