Despite growing concerns within the brewing industry, new analysis suggests that the rise of cannabis and THC beverages has only a limited impact on beer sales across the United States. According to Matt Gacioch, Staff Economist at the Brewers Association, beer shipment declines in states with legalized recreational cannabis have been only slightly steeper than in states without such laws. Over the past decade, shipments fell by an average of -1.9% annually in recreational states compared to -0.7% in non-recreational states. However, these differences remain within normal statistical variation and are not significant enough to indicate a strong causal relationship.
More recent data reinforces this conclusion. Between 2023 and 2025, beer shipments declined by -4.0% in recreational states versus -3.2% in non-recreational ones. While this suggests a marginal difference, broader industry trends—such as shifting consumer preferences, increased competition across beverage categories, and changing social habits—appear to play a much larger role in declining beer volumes.
The rapid expansion of hemp-derived THC products, enabled by the 2018 Farm Bill, has also raised concerns among brewers. However, the data shows virtually no measurable impact at the state level. States where hemp-derived THC beverages are fully legal recorded a -3.5% decline in beer shipments over the past three years, closely aligning with the national average of -3.6%. Even when comparing states with and without legal THC products, the differences are negligible.
A combined analysis of recreational cannabis and hemp-derived THC legalization shows slightly sharper declines in states where both are permitted (-4.1%). However, this finding is based on a limited number of states and may reflect other structural factors, including population size and market dynamics.
The analysis highlights that while substitution between beer and THC products does occur at the individual level, the overlap in consumption occasions is relatively limited. Beer continues to dominate social settings, whereas THC consumption is more often associated with private or solitary use. This distinction suggests that the two categories may coexist rather than directly compete in many scenarios.
Ultimately, the findings indicate that cannabis is not a primary driver of beer’s current challenges. Instead, the sector faces broader, systemic pressures affecting overall demand. For brewers, the key takeaway is to focus on strengthening beer’s role in social occasions while continuing to monitor developments in the evolving THC beverage market.
