Legal cannabis sales in Oregon declined for the second year in a row in 2023 after the market set its annual sales record in 2021, the Oregonian reports.
Licensed cannabis retailers in Oregon recorded about $955 million in sales during 2023, down from about $994 million in 2022. The state’s cannabis market had previously spiked in 2020 with the onset of the COVID-19 pandemic, ultimately peaking in 2021 at $1.2 billion in annual cannabis sales.
Retail cannabis prices in the state have stagnated since falling to just $4 per gram in early 2023, the report said.
Oregon’s adult-use cannabis industry was launched in 2014 with no restrictions on the number of cannabis licenses allowed in the state; additionally, acquiring a commercial cannabis license was easier than in most other states. So, while the market grew fast at first, the mismatch in supply and demand eventually became evident as prices plummeted amid surging supply.
“Given these market conditions of oversupply, (retail) saturation, and stable consumer demand, low prices make it difficult for businesses to be profitable.” — The Oregon Office of Economic Analysis, via the Oregonian
The Cannabis Industry Alliance of Oregon last month urged the state to make permanent a moratorium on new cannabis licenses to help address the industry’s oversupply and market competition issues.
Lawmakers passed a law in 2019 allowing industry operators to export their cannabis products to other state-legal markets but the policy will only take effect if allowed at the federal level, and the federal government has yet to make significant cannabis reforms.
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