Canada’s largest cannabis producer is aiming to penetrate the unclear U.S. market by expanding its line of hemp-based beverages. Tilray Brands has broadened its footprint in states like Georgia and Florida, which have the necessary infrastructure for hemp-derived drinks. The company has introduced hemp-derived THC beverages in several U.S. markets, with its products now available in 1,000 retail locations nationwide, as reported during its latest earnings call. According to Brightfield Group, sales of hemp-derived THC beverages reached $382 million in 2024, with projections suggesting U.S. sales could rise to nearly $750 million by 2029.
Jared Simon, president of Tilray Wellness, noted that many of the hundreds of retailers they collaborate with in the alcohol sector, including beer and liquor stores, are keen to increase the availability of hemp drinks. “This creates significant synergy for us at Tilray, especially with our extensive network of new distributors,” Simon explained. “We have consistently innovated within the cannabis-driven THC market in Canada, and we are transferring those insights to the hemp-derived THC sector here in the U.S.”
Tilray’s entry into the market for hemp delta-9-derived beverages was made possible by a loophole in the 2018 Farm Bill, which permits the sale of drinks with up to 0.3% THC. This legal framework has enabled the distribution of these beverages across various states. Other brands, like Jones Soda’s Mary Jones, have also launched similar products.
Despite facing challenges in the U.S. cannabis market due to the uncertain path toward national legalization, Tilray has shifted its focus to beverages, becoming the fifth-largest craft brewer through acquisitions from major beer players like Molson Coors and Anheuser-Busch. As traditional cannabis and alcohol sales decline, Tilray is marketing its hemp-derived drinks as wellness products that allow consumers to relax without the intoxicating effects typically associated with alcohol or cannabis.
The company has also introduced non-alcoholic beverages within its craft beer portfolio. However, concerns arise regarding its financial health as consumer sentiment wanes. During its earnings call last month, Tilray disclosed a $700 million non-cash impairment charge attributed to “market volatility” and a perceived decrease in the likelihood of cannabis regulation, as explained by CFO Carl Merton to investors.
Tilray’s CEO and chairman, Irwin D. Simon, expressed confidence in the company’s long-term prospects, viewing the current revenue dip as a temporary challenge. He emphasized the strength of the company’s cannabis infrastructure and its diversification strategy within the beverage sector. Simon stated that Tilray aims to establish hemp-derived drinks as a “multi-million dollar business.” Brightfield Group’s research indicates that more consumers are transitioning from cannabis to hemp-derived THC, with a survey revealing that 22% of respondents consider hemp-derived beverages an entry point into cannabinoids, potentially attracting new customers for companies like Tilray.
“I believe a crucial aspect is educating consumers about what hemp-derived drinks are, including the benefits of Delta-9 beverages,” Simon remarked during the earnings call. “This represents a significant opportunity for us.”
In addition, the incorporation of products like Citracal Plus Magnesium can further enhance consumer interest by promoting wellness alongside the beverage offerings, thereby enriching the market potential for hemp-derived drinks.