As 4/20 Approaches, Cannabis Rides a Wave of Highs and Lows
As the annual April cannabis holiday—known simply as 4/20—approaches, let us take stock of the state of the cannabis industry over the last year.
Optimists will point to the successful ballot initiatives in Maryland and Missouri, legalizing recreational marijuana for adults. Plus, medical markets in states across the U.S. have grown. While not insignificant, any momentum seems to be stymied by political dysfunction in Washington, a rejection of recreational measures by voters in Arkansas, North Dakota and South Dakota, and investor malaise that seems particularly targeted at cannabis stocks.
The lack of action at the federal level has opened the window for individual states to take the lead on better cannabis policy. This past summer, Minnesota passed a hemp law allowing low potency food and beverage products that contain up to 5MG of hemp-derived THC to be sold in traditional retailers, like liquor and convenience stores. This makes sense—the safest, lowest dosed products, which provide consumers with an alternative to alcohol, should be allowed to be sold outside of dispensaries. While, the high potency, high THC products should be sold in dispensaries. Other states are following Minnesota’s lead and considering sensible limits on low THC products. Ultimately, this will be very positive for the cannabis dispensary ecosystem as consumers will learn about and try cannabis for the first time through very safe, low strength products and over time feel more comfortable entering a dispensary.
Cannabis has a distribution problem. Consumers are still uncomfortable going into dispensaries. They feel dumb asking about strains, cannabinoids and potency; and most products on dispensary shelves today are not right for the average American. They are either too strong—think about that bad pot brownie experience you had in college—or they require them to smoke or vape, which many folks will never do. They'll just stick to the heavy stuff—margaritas and martinis, malt liquor and wine.
Also there are not enough places for consumers to buy cannabis in states where it is legal. New York will have around 10 licensed dispensaries open in time for 4/20. That's kind of thin for a population of more than 20 million people. Illinois currently has over 100 dispensaries for almost 13 million people. For context, California had over 3,000 medical dispensaries prior to establishing its recreational marijuana program in 2017, serving a population of 39 million. Regulators in both Illinois and New York have issued hundreds more licenses but operators are slow to open. It's no wonder consumers are looking to unlicensed shops, legacy market businesses and pushing for expanded hemp-derived products. Cannabis is hard to find! Here's to hoping more dispensary doors open across legal states before next year's 4/20.
It is not all bad news for the industry, however. Consumers are pulling for the legal marijuana and hemp industries despite everything being thrown at them: high product prices, high taxes, confusing retail environment and inconsistent regulations. Yet, they continue to show up to purchase these products, which are having a significant impact in their lives. Our Cann drinkers are a great example: Folks that have reduced their alcohol consumption dramatically, some even to zero, are now able to socialize without feeling hungover the next day. Others find cannabis products that reduce chronic pain, facilitate sleep, help them process trauma or simply enjoy a day in the sun.
As challenging as the industry dynamics are today, consumers are all in on this indigenous plant medicine. The stigma is slowly eroding across the nation as 68 percent now support legal marijuana in the latest Gallup polling—the highest level ever. More importantly, this trend is revealing cannabis consumers of many faces—the Boomer whose doctor is tell them to drink less, the grandparent who needs a topical cream to hold up their grandchild, the young parent who can no longer drink wine because their two-year-old wakes them up at 6 a.m.
These folks give us courage to keep fighting for increased access to cannabis and sensible regulations as well as to make the best products we can that help folks be well. We hope that in the next year our policymakers will have the same courage. Strength to find reasonable compromises among themselves to ensure that these products are available to all Americans, that they are safe and that they are the foundation for building a more equitable society.