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Texas "Total THC" Rule: What Hemp Retailers Need to Know

New hemp regulations taking effect March 31 are reshaping what retailers can carry on their shelves. Here's what changed, what's at risk, and how to pivot.

David PalatnikMarch 25, 2026 · Updated March 26, 2026 · 12 min read

Texas hemp retailers are facing a sudden and significant shift in how THC is regulated. For many businesses, the impact is immediate.

As of March 31, 2026, the Texas Department of State Health Services (DSHS) has introduced a new method for calculating "Total THC." Under this updated framework, THCA is now included in the definition of THC. That means products that were previously considered compliant may now exceed the 0.3% Total THC threshold.

On top of that, DSHS has increased retail registration fees from $155 per location to $5,000 per location, and manufacturer licensing fees from $258 to $10,000. For small operators already running on tight margins, the timing could not be worse.

This isn't a gradual change. It's a recalculation that affects inventory, compliance, and cash flow all at once.

Key Dates and Regulatory Timeline

What Actually Changed With "Total THC"?

The regulation doesn't change what THC is. It changes how it's measured.

Previously, THCA was tested and labeled separately from Delta-9 THC. Under the new DSHS rules, THCA is now included in the definition of THC and factored into Total THC calculations using a post-decarboxylation formula. That means products with higher THCA levels may now exceed the 0.3% Total THC threshold, and lab results that previously passed may no longer meet the new standard.

THCA on its own isn't psychoactive. But when heated or smoked, it converts into Delta-9 THC. That conversion is now factored into the test, which is why some products that were previously compliant may no longer meet the threshold under the new calculation method.

The rules also introduce new restrictions on smokeable hemp products. Combined with the updated THC calculation, entire product categories are affected.

For retailers, this creates a disconnect between what's currently on shelves and what's compliant under state law starting March 31.

How to Read Your COA Under the New Rules

If you carry hemp-derived products, you need to know whether they pass the new Total THC calculation. Here's what to look for on a Certificate of Analysis (COA).

Which Products Are Most Affected?

The impact is concentrated in product categories that may exceed the new Total THC threshold:

These products represent the highest-risk inventory for retailers as the new regulations take effect. Hemp businesses selling non-compliant products face penalties including license revocation and fines up to $10,000 per day.

What This Means for Texas Hemp Retailers

This isn't just a compliance update. It's an operational disruption hitting from multiple directions at the same time.

At the store level, even small compliance gaps can now carry significant consequences.

What Retailers Should Be Doing Right Now

If you operate a hemp retail business in Texas, the priority is risk mitigation and preparation.

The businesses that move fastest will be in the strongest position to stay operational.

The Bigger Picture for Texas Hemp Shops

For many small and mid-sized retailers, this change goes beyond a single compliance update. It creates a structural problem: heavy reliance on product lines now affected by the new regulations, limited capital to absorb inventory losses, rising operational costs from licensing fees, packaging, and compliance, and revenue pressure from both sides.

Some retailers report that the combination of lost revenue from affected products and the new $5,000 fee is forcing difficult decisions about whether they can continue operating.

And a larger federal threat is on the horizon. Language included in the November 2025 government funding bill redefines hemp to exclude products with more than 0.4 milligrams of THC per container. That federal restriction is scheduled to take effect November 12, 2026, which could affect even more product categories.

The window to pivot is now.

How MNG Brands is Responding

In response to these changes, MNG Brands has launched a statewide initiative designed specifically for Texas hemp retailers affected by the new regulations.

We are putting our capital and our supply chain to work to ensure Texas shops can pivot, stay legal, and stay profitable.

David Palatnik

President, MNG Brands

The goal: help businesses transition quickly, stay compliant, and remain operational without empty shelves or rushed decisions.

The Texas Hemp Rescue Grant

MNG Brands has committed $50,000 in recovery support for Texas hemp businesses affected by the new rules, focused on two core programs:

*Conditional upon the approval of licensure.

This isn't just financial support. It's an operational pivot designed to keep businesses running without a gap in product availability.

Applications are open now. Selections are guided by a panel of industry leaders, policy advocates, and business experts including David Palatnik (President, MNG Brands), Cynthia Cabrera (Industry Advocate), Mark Bordas (Executive Director, Texas Hemp Business Council), Heather Fazio (Director, Texas Cannabis Policy Center), Craig Katz (Government Relations and Compliance Manager, MNG Brands), and Dafna Revah (Vice President, MNG Brands).

What Products ARE Compliant?

The new rules don't affect everything. These product categories remain fully legal and sellable in Texas:

Browse the full MNG Brands wholesale catalog →

Who This Program Is For

This program is built for Texas hemp retailers, CBD and smoke shop operators, multi-location retail businesses, and wholesale partners affected by the new hemp regulation changes.

It is intended for Texas businesses dealing directly with the operational and financial impact of the new rules. It is not intended for individual consumers.

How To Apply

Retailers can apply for license fee reimbursement, inventory swap participation, or both through a single application on the Texas Hemp Rescue Grant page.

If you're applying for the Inventory Clean Sweep buy-back, download the inventory template, fill in your current non-compliant stock, and upload it with your application.

Applications are open now. The March 31 deadline is days away.

About MNG Brands

MNG Brands is a national leader in functional wellness retail and product innovation, operating one of the largest privately owned CBD and kratom platforms in the United States. The company launched this program to help Texas operators adapt to regulatory change without being forced into unnecessary closures, empty shelves, or rushed decisions.

Final Takeaway

The Texas Total THC rule is not just another policy update. For many retailers, it is a turning point.

The businesses that respond quickly, review inventory carefully, and move into compliant product categories will be in a far better position than those waiting for clarity that may not come in time.

If your shop is facing inventory exposure, licensing pressure, or uncertainty about what comes next, the Texas Hemp Rescue Grant was created to help you make that pivot.

Frequently Asked Questions