News

The Maturity of the Market

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Colorado cannabis users have spent about $1.42 billion on cannabis through August, positioning the industry to exceed $2 billion in 2020 sales – four years earlier than industry experts’ predictions.

These numbers come as the Marijuana Enforcement Division released an in-depth report on the Colorado cannabis market, which was prepared by MPG Consulting (formerly the Marijuana Policy Group) and Colorado Boulder’s Leeds School of Business. The key themes include:

  • The regulated market is nearing maturity as evidenced by price trends, supply patterns and consolidation.
  • A larger and more compliant market has emerged and includes accurate reporting, better internal controls, better use of the inventory tracking system by state and industry, and an effective regulatory and enforcement system.
  • Most all regulated marijuana products have continued to decline due to improvements in production efficiencies and competition.
  • Adult use marijuana sales are still increasing, medical sales, not so much.
  • Shifting demand to Concentrates continues.
  • Average potency continues a steady increase while price per dose is decreasing.
  • Consumption is increasing among Colorado adults.
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It is far too early to determine what the long-term effects of the coronavirus will be on the cannabis industry. So far, the industry as a whole appears to have fared relatively well. But questions remain as to what happens when unemployment benefits run out and whether the local economies in Colorado and other states are forced to shut down again due to the pandemic.

Listen: From ‘Illegal’ To ‘Essential’: How The Pandemic Has Affected The Budding Cannabis Industry

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In Colorado, a new study has launched to measure the effects of COVID-19 on workers in the cannabis industry. The goal of researchers at the University of Colorado Department of Anthropology, who are leading the study, is to learn more about worker exposure to coronavirus, hazardous working conditions, lack of personal protective equipment (PPE), and lack of social distancing in the workplace.

Records are meant to be broken . . . 

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Colorado cannabis sales hit nearly $1.75 billion in 2019, setting a new annual sales record for the state. The jump from $1.54 billion the year before is attributed by some to the proliferation of non-flower marijuana products, such as edibles and vape pens.

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Tax revenue also surpassed previous years, hitting $302 million.

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And cannabis tax money is funding important programs, like ones that fight back against bullies. Since 2016, marijuana taxes have provided $6 million to 71 schools to fund anti-bullying education. These Bullying Education Prevention Grants have helped teachers and staff train more than 34,400 students.

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Sales of adult-use cannabis in Colorado eclipsed $1.4 billion in 2019, a new record.

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The jump is being attributed to new customers entering the market.

So who are these new customers? The data suggests newbies are coming from Generation Z – those born in 1997 and later – and consumers who continue to transition out of the illicit market and into the regulated, legal industry.

 

View the Marijuana Business Daily Article and Graph »

The hot streak continues

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Cannabis monthly sales reached the highest monthly total ever in August, according to the Colorado Department of Revenue. In the first eight months of 2019, Colorado has reported over $1.15 billion in dispensary sales – indicating that the industry is on track to eclipse last year’s overall sales of $1.55 billion.

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What goes up must come down.  And then come up again. 

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After a year of decline, Colorado cannabis prices are surging upward again.  The average price of a pound of dried, wholesale marijuana hit $999, according to the Colorado Department of Revenue.  Is it a “phase?” Will there be supply shortages?

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Medical licenses drop as recreational sales jump

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Colorado medical licenses decline as recreational sales increase.  Last year, 66 percent of the total pounds of marijuana flowers and 86 percent of the total units of edibles were for recreational use.

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You know what’s cool?

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“A million dollars isn’t cool. You know what’s cool? A billion dollars.”

 – Sean Parker, The Social Network

Colorado has surpassed $1 billion in cumulative tax revenue since legalization in 2014. The industry continues to grow, which is good for all of us considering the programs the tax revenue funds. “Marijuana revenue funds a range of youth and public health programs in Colorado, including mental health services, youth literacy initiatives and anti-bullying programs in schools. Marijuana tax revenue goes to both state and local governments.”

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Want to see exactly where that money goes?

The state’s flowchart explaining it for you right here. 

Grandma and Grandpa need some relief too.

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As we’ve been saying for quite some time, seniors are the fastest-growing group of new cannabis consumers in the US. But a new study that looked at marijuana consumers across Colorado suggests a growing number of Americans aged 65 and older are using cannabis regularly both for medical and recreational purposes. Among those in the study who say they use it medicinally, the majority appear to be self-medicating.

One reason older people are turning to cannabis is because it can soothe the symptoms of problems like arthritis, Parkinson’s, and chronic pain. But a study published this month in the journal Drugs & Aging, found that a lack of research, unclear communication with doctors, and a reluctance to be honest about its use due to stigma, are all stopping older people getting the products they need. 

“From a physician’s standpoint this study shows the need to talk to patients in a non-judgmental way about cannabis,”  said one of the study’s co-authors. “Doctors should also educate themselves about the risks and benefits of cannabis and be able to communicate that effectively to patients.”

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The cannabis eclipse

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Retail sales of medical and recreational cannabis in the United States are on pace to eclipse $12 billion by the end of 2019 – an increase of roughly 35% over 2018 – and could rise as high as $30 billion by 2023.

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