Cannabis markets soften, yet still robust
With its uncanny power to chase away the boredom of being stuck inside during a worldwide pandemic, cannabis usage and sales skyrocketed during the COVID-19 pandemic but have since come back down to Earth as the world has opened back up.
“Across California, Colorado, Nevada and Oregon, total dollar sales fell about 10% between [the last quarter of] 2021 and [the first quarter of] 2022, and fell about 12% from [the first quarter of] 2021 to [the first quarter of] 2022,” according to a report from BDS Analytics Inc., a Louisville cannabis market intelligence and research company. “Some of this decline is due to falling average retail prices (ARPs), with the equivalent ARP in [the first quarter of] 2022 falling about 5% from [the fourth quarter of] 2021 and remaining almost flat from [the first quarter of] 2022 across these four markets; all markets also saw declines in unit sales.”
Still, many of the players in the Boulder Valley and Northern Colorado cannabis industry and its ancillary businesses appear resolved to remain standing in 2022.
For example Urban-gro Inc. (Nasdaq: UGRO) is crawling closer to profitability, while Growcentia Inc. moved from Fort Collins to a much larger headquarters in Loveland this year.
The marketplace for cannabis companies selling their wares locally increased this year as Broomfield paved the way to open its first recreational dispensaries.
More than twice as much hemp is grown in Colorado than gets processed, Gov. Jared Polis said in March on the opening day of the annual NoCo Hemp Expo.
Hemp is an incredibly versatile plant that can be used to make a host of different products such as paper, plastics, clothes, building materials and animal feed, Polis said, stressing that manufacturers need to look beyond CBD products in the future.
BDSA predicts that cannabis beverages will continue to become an increasingly popular method of use and could begin to encroach on alcohol’s markets.
Not satisfied with being potential rivals, local cannabis and booze companies are actually forming alliances.
Oskar Blues Brewery and Denver-based marijuana company Veritas Fine Cannabis this year partnered on a new cannabis-inspired, 4/20-celebratory IPA offering called Veritasty.