Texas clamps down on psychoactive hemp. New rules ban smokeable products, forcing industry shifts and potentially higher costs for businesses.
The ground has just shifted under Lone Star hemp product sellers and consumers as new regulations effectively banning the legal sale of smokeable psychoactive hemp products went into effect today, March 31, 2026.
Promulgated by the Texas Department of State Health Services (DSHS), the regulations include a new "total THC" rule, which includes the cannabinoid THCA in calculating delta-9 THC. THCA converts to delta-9 THC when heated (smoked), and the new rule will push THC concentrations above the 0.3 percent delta-9 THC allowed under the state's 2019 hemp law.
Most hemp edibles and gummies will still be allowed but will face stricter packaging and testing requirements. And dramatically higher licensing fees for manufacturers and retailers, even though lower than initially proposed, could drive up prices and/or force some businesses out of the market.
THCA flower has become wildly popular in the state, accounting for more than half of all psychoactive hemp products sold at some stores, because it delivers that THC high, but it now no longer legal to sell.
The changes in the hemp industry are the result of an executive order from Gov. Greg Abbott (R) last fall after the legislature spent most of the year haggling with what to do about hemp products and failed to resolve the issue. Acting on that order, both DSHS and the Texas Alcoholic Beverage Commission, which will control hemp sales at licensed liquor outlets, recommended the new regulations in December.
DSHS finalized its rules early this month and set March 31 as the date they would take effect. Although DSHS held public hearings after issuing the preliminary regulations and was told by hundreds of respondents that they opposed counting THCA as delta-9 THC, the department retained the new rule anyway. It was more open to revising its dramatically increased fee structure, dropping a proposed 10,000 percent increase in fees for manufacturers and retailers, but still adopting fees of $5,000 per year for retailers and $10,000 for manufacturers. But those are still dramatic increases—of 33 and 40 percent, respectively—over existing fees.
In the final countdown to the ban, stores across the state scrambled to sell their remaining inventory.
"We are still running a sale, trying to burn out the stuff that’s no longer going to be available," said Kenneth Berner, who co-owns Burners Vape, Smoke and Herb in League City and Bacliff, on Monday. "And that’s going to happen ’til the end of the day, and then just whatever’s left at closing time will get boxed up."
Berner said that even with sale prices, he still expects to have to eat between $10,000 and $15,000 worth of product he can no longer sell and that his prospects moving forward are grim.
"Roughly 75% of our business is hemp products, and 90 to 95% of that business is smokable," Berner said. "So, it’s going to be very devastating."
In Dallas, MoonTaxi was offering smokeable hemp products for 20% this past weekend in a bid to clear inventory before the ban kicked in.
"[Tuesday] is when the new rules and regulations that DSHS is putting through go into effect, which is going to majorly affect 70% of our sales," General Manager Tess Bratton-Rodriguez said.
Demand for THCA flower is not going to go away merely because the law has changed. And that leaves an opening for actors outside the law.
"Banning THCA flower won't stop people from smoking. It won't reduce demand," The Texas Hemp Business Council wrote on X. "It will just shut down legitimate businesses and push consumers straight to the black market."