colorado cannabis Archives - The Real Dirt with Chip Baker

Is Colorado cannabis industry dying or just returning to normal?

by Travis C | Jul 28, 2022 | Blog, Business, Cannabis Business, Cannabis News, Culture, Editorial, Legalization

The Colorado cannabis market that thrived during the peak of the COVID pandemic has been slowly coming back down, decreasing 32% since the state broke records in July of 2020.

Colorado cannabis sales broke $226 million in July 2020 alone, setting a new record for the state. Latest state records show that total cannabis sales in the state for May 2022 were just $147 million.

At first glance this could be interpreted as the market correcting itself following the massive boost it received during the COVID pandemic. It could also be seen as the Colorado cannabis market losing marketshare following the legalization of cannabis in neighboring states like New Mexico and Oklahoma.

This answer is likely a combination of both.

During the peak of the pandemic, cannabis sales rose to record levels across the country. While many restaurants and stores shut down for months, in most states with recreational and medical cannabis, dispensaries remained open.

Cannabis was treated similarly to alcohol in this instance; liquor stores were allowed to remain open in most states during the pandemic as well.

The picture of Colorado’s cannabis industry profits becomes less pessimistic when taken in context and compared to pre-COVID numbers. However the numbers still show an industry that is struggling to grow as the national industry also grows and consolidates.

For comparison, let’s take the same month that we can consistently track according to state released data; May.

In May 2019, total Colorado cannabis sales were $143 million. One year later in May 2020, the state sold over $192 million in cannabis, which would gradually increase month by month until the record breaking month of July 2020 ($226 million).

It is easy to see the boost that COVID gave to cannabis sales in Colorado, as in May of 2021 sales were back down to $194 million. This number is just $2 million more than the same month in 2019.

Comparing to 2019 and removing 2020 from the equation, May 2019 to May 2022 show almost no growth.

Coincidentally, July 2021 was also one of the most successful months of the year, selling $202 million in cannabis products. The industry has not broken $200 million in sales since then.

As an additional comparison, we can look at the same 5 month timeframe from this year (2022) and last year (2021), from January to May.

The mean cannabis revenue in Colorado in 2021 from January to May was $192 million.

The mean cannabis revenue for 2022 is $151 in the same time period.

For a pre-COVID reference, sales for the same period in 2019 were only $133 million.

In other words, while Colorado cannabis sales are down compared to previous quarters, the industry has overall seen growth. The boost the industry gained from COVID has had residual impacts, with more people still purchasing cannabis than before the pandemic.

However the state has not seen a booming month like July 2020 for some time. Current trends in the industry hint that it is unlikely the state will see sales numbers surpassing $200 million until the next holiday season, if ever again.

Billionaire-backed Denver Ordinance 300 would raise retail cannabis tax by 13%

by The Real Dirt | Oct 13, 2021 | Blog, Business, Cannabis Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Industry News, Legalization, Politics

Denver Ordinance 300 would raise taxes on recreational cannabis.

An advocacy organization registered in Delaware and backed by a Bahamas-based billionaire Forbes calls “the world’s richest 29-year-old” is going head-to-head with the Denver cannabis industry — and the mayor — through a proposed city ordinance that would increase Denver’s recreational marijuana tax by 13%.

Initiated Ordinance 300, which will appear on the 2021 ballot, proposes that “Denver retail marijuana sales tax be increased by $7 million” through a 1.5% tariff to fund “pandemic research” at the University of Colorado Denver.

Should a statewide ballot initiative that will also be put before voters in 2021, Proposition 119, pass along with Ordinance 300, Denver cannabis consumers will be paying nearly 25% more for their weed within the next three years. Denver residents currently pay a total of 26.41% in taxes on recreational cannabis: 11.41% to the city and 15% to the state.

The move has Colorado cannabis industry insiders wondering why Colorado, why CU Denver and why their sector.

“Ordinance 300 taxes Denver cannabis consumers to fund, and I’m putting this in big old air quotes, ‘future pandemic research,'” Marijuana Industry Group Executive Director Truman Bradley told Denver Business Journal. “I literally cannot think of a cause that’s going to achieve more attention globally than [pandemic research]. It makes no sense to ask Denver cannabis consumers to foot the bill for that.”

MIG, along with industry advocacy organization Colorado Leads, primarily expressed concern about the impact on cannabis buyers who consume for medical purposes but may not have the means for a medical card — something that requires an often expensive annual physical exam and fees paid to the state — or simply don’t want to be on an official list.

“This measure — funded by a rich, out-of-town carpetbagger — taxes people’s pain relief to pay for a random pandemic preparation program that has no accountability, no oversight, no specific solutions and no connection to the marijuana industry,” Chuck Smith, Colorado Leads board president and CEO of Denver-based cannabis giant BellRock Brands, told DBJ. “If, as the proponents contend, this program is so beneficial, why aren’t all Denver industries asked to pay their fair share?”

Read Full Story on Denver Business Journal

Colorado’s Largest Cannabis Farm Bought by Massachusetts Company

by The Real Dirt | Oct 11, 2021 | Blog, Business, Cannabis Business, Cannabis News, Industry News, Legalization

colorado cannabis farm purchased by Massachusetts company

One of the country’s largest marijuana companies has officially purchased one of the country’s largest outdoor marijuana growing operations.

Curaleaf, a publicly shared marijuana corporation with business holdings throughout America and Europe, just announced that it has finalized the acquisition of Los Sueños Farms, Colorado’s largest outdoor marijuana growing operation. The purchase, worth a reported $67 million in cash, stock and assumed debt, was first announced in May, but didn’t close until this month, according to Curaleaf.

Two Pueblo dispensary licenses previously held by Los Sueños were included in the deal.

Under the agreement, 61 percent of the sale price will be paid in Curaleaf shares, 29 percent in cash and 10 percent in acquired debt. According to Curaleaf, Los Sueños founder Bob DeGabrielle will continue to oversee the farm and “take responsibility” for the company’s wholesale and retail operations.

Located in Pueblo County, Los Sueños’ outdoor marijuana cultivation comprises 66 acres of land with an additional 1,800 plants grown in an on-site greenhouse facility. Los Sueños originally agreed to an acquisition offer from Shwazze, then named Medicine Man Technologies, in 2019. However, Schwazze terminated the deal in 2020 for undisclosed reasons.

Los Sueõs joins over 130 dispensaries and growing operations across 23 states currently owned by Curaleaf, as well as a handful of infused-product brands, including Blue Kudu, a Colorado edibles maker purchased in 2020 for an undisclosed amount. Curaleaf also launched Select Cannabis, a line of vaporizer products and edibles, in Colorado earlier this year — after acquiring the original Select brand in Oregon.

Read Full Story on Westword

Denver grants first cannabis delivery license

by The Real Dirt | Jul 21, 2021 | 420 News, Blog, Business, Cannabis Business, Cannabis Law and Compliance, Cannabis News, Culture, Industry News, Legalization

Ever had one of those lazy days where you don’t want to get off the couch, even to buy cannabis? Soon, you won’t have to.

Strawberry Fields, a marijuana cultivation company with five Colorado dispensaries, including one at 3453 S. Yosemite St., was awarded Denver’s first cannabis delivery license Tuesday.

“I think it’s going to open up a lot of different avenues and outlets, more availability for our (medical cannabis) patients and consumers,” said Ethan Shean, chief retail operations officer for Strawberry Fields.

The service will not be immediately available, however.

Retail cannabis outlets must contract with companies that have obtained a cannabis transportation license, and none of those have been issued, although city officials told BusinessDen those applications could be approved within the next couple weeks.

Shean said the ability to deliver products will help Strawberry Fields connect with homebound medical cannabis patients and to people who have limited transportation.

“That is part of the inclusion that we want,” Shean said. “The customers and the patients who may not have access to come to one of our locations could be patients who rely on public transportation. We want to be accessible and convenient.”

Strawberry Fields opened in 2010 as a medical dispensary before adding recreational sales when it became legal in Colorado. The company is in communication with a few people who have applied for cannabis transportation licenses, Shean said.

State law governs how much cannabis can purchased per day, which is up to one ounce of “flower” per person or eight grams of concentrate with more than 800 milligrams of THC.

The city of Denver will only allow people who qualify as a “social equity applicant” to apply for medical and retail cannabis transportation licenses until July 1, 2024. Transporters can contract with multiple cannabis stores for their services. Deliveries must take place between 8 a.m. and midnight.

Existing retail and medical cannabis stores must contract with transportation licensees until July 1, 2024. After that, licensed dispensaries will be able to conduct deliveries themselves.

Read Full Story on Business Den

Denver opens applications for cannabis delivery licenses, consumption lounges

by The Real Dirt | Jun 28, 2021 | 420 News, Blog, Business, Cannabis Law, Cannabis Law and Compliance, Cannabis News, Industry News

Denver cannabis delivery licenses are being accepted now

Applications are now open for marijuana delivery and transporter licenses in Denver for the first time in the city’s history, the Department of Excise and Licenses announced.

The city is also accepting applications for new marijuana store locations for the first time since 2016, in addition to applications for marijuana cultivation and manufacturing licenses.

This comes two months after Denver changed its marijuana policy to allow for social equity delivery and hospitality businesses where patrons can consume marijuana on the premises. Applications for the hospitality business licenses are expected to open in November, the department said.

“This is a big part of the biggest overhaul in marijuana rules and regulations since initial legalization that the mayor signed into law on 4/20,” said Eric Escudero, spokesman for the Department of Excise and Licenses.

Under Denver’s new marijuana policy, there is no cap on the number of licenses and permits available, and there is no deadline to apply.

Delivery licenses will only be available to social equity applicants until 2024. Licenses for stores, transporters, cultivations, manufacturing and the new hospitality establishments will be limited to social equity applicants until 2027.

Social equity applicants are defined as Colorado residents who have never had a marijuana license revoked and meet one of the following social equity criteria:

Applicant lived in an opportunity zone or a disproportionately impacted area between 1980 and 2010
Applicant or immediate family was arrested, convicted or suffered civil asset forfeiture due to a marijuana offense
Applicant’s household income doesn’t exceed 50% of the state median income

By providing exclusivity to social equity applicants, Denver officials say they are trying to make up for the damage caused by the War on Drugs and the unequal persecution of disadvantaged communities for marijuana offenses.