BY DR. LLOYD COVENS
New Colorado Record
Colorado cannabis sales for March, 2019 set an all-time record nearing $142.4Mil., an astounding number coming in a non-tourist month, and showing higher overall unit sales at somewhat lower retail prices. Since Feb. 2014 (inception of RMJ), Colorado has received $993.2 million in state sales tax and fees, with a gross 5-year RMJ/MJ sales total surpassing $6.43Bil. For 2019, statewide tax (cities and counties also get separate taxes) is averaging $29.2Mil. per month, with first quarter cannabis sales at $386.7Mil. The closest prior record year saw Colorado sales of $141 in August 2018, a heavy tourist month. March was up 16% from February retails sales, with adult-use contributing $114.3Mil, and $28.1Mil (22 %) for medical.
We Have a Winner …
The potential for the biggest retailers to offer CBD was reported on May 12 by the New York Post. WalMart, Kroger and Safeway are all named as requesting CBD sample products. The Post story states: The Post has learned that top executives at major chains such as Walmart and Target have been quietly meeting with makers of drinks, gummy bears, topical creams and oils that are infused with cannabidiol, or CBD. The chains, which also include big supermarkets such as Kroger and Safeway, are requesting samples of CBD products, along with lab results and pricing information, manufacturers said.
CNBC issued its 7th list, “Disruptor 50” last week, naming one company which would directly re-shuffle the whole concept of MJ plantings. While no cannabis company made the grade, a vendor working with Canada’s large licensed producer, Cronos Group, did make the cut. Boston’s Ginkgo BioWorks was named a major disruptor for its lab-based push to make all sorts of consumable products from synthetics. Ginkgo is working on a full suite of cannabinoids from yeast, partially funded with $120 million in funding from Cronos.
Oregon’s Six Million Pound Surplus
Oregon hopes to ship some of its 6-million plus pounds of surplus cannabis to other western states, and its legislature has passed a first-in-the-nature bill. While observers see the bill as being clearly in violation of federal cannabis illegality, the Oregon proposal seeks to create a legal structure whereby another adjoining state (most likely Nevada at first) would sign a compact with Oregon to allow dual-state commerce to the buying-and-selling of legal RMJ cannabis.
Tilray Takes a Hit
Tilray issued first quarter (2019) results, reporting higher revenues at $23Mil. (including good sales by new subsidiary, Manitoba Harvest), but also a dismal loss of $27.9Mil, which is a four-times larger loss than a year earlier. Over at CNBC, Jim Kramer noted Tilray stock shot up from $100 to about $300 within a matter of days last October, just prior to legalization in Canada. The stock collapsed to $100 a month later, and been below $50 for much of 2019. “In Tilray’s case, there haven’t been any major negative catalysts Kramer said. “It’s just the stock should never been so high in the first place.”
Paved with Green Intentions
New Michigan Governor Gretchen Whitmer ran on creating a $2.5Bil fund to fix the state’s crumbling roads. Part of the funding will increase drivers’ gas tax to 45cents a gallon, which prompted a question of why MJ taxes couldn’t be used. At a May 3 area chamber lunch, Witmer quipped “Every man, woman, and child would have to buy $2,500 worth of weed a year.” Rather than the projected $140/month RMJ use, the fund would need every Michigan adult to buy 216 pounds a year. “If we were consuming that much, would any of us really care about the damn roads anymore?”, asked Whitmer. The governor wants quick action to implement the start of RMJ sales and fired the current Michigan board overseeing cannabis policy.
New York RMJ Bill Fails
New York primary gubernatorial challenger Cynthia Nixon had pushed (now-re-elected) Gov. Andrew Cuomo to commit to support an adult-use MJ bill in New York. But after months of wrangling, Cuomo blamed recalcitrant lawmakers for the bills’ failure, adding he refused to start “twisting arms” for votes. After seeing 2019 RMJ bills fail in New Jersey, New Mexico, Hawaii and New Hampshire (and a likely delay in Connecticut) we asked MPP for comment. “While no legislatures have crossed the finish line yet this year, more took part in the race than ever before, and they put a lot more effort into it and made much more progress than ever before,” said MPP’s Mason Tvert. And Tvert says it’s no longer an issue of whether cannabis should be legal. “it’s about all the details, big and little.” With three weeks to go, all eyes now turn to Illinois as the remaining hope for creating RMJ state #11. Meanwhile a raft of new hemp authorizing (and CBD legalizing) bills have passed in Georgia, Florida, Washington, NM, Iowa, Texas and Kansas.
It’s a quick glimpse of the national media love-affair with “all things CBD.” For the morning NBC Today show, its reporter Natalie Morales bringing (yet more) publicity to that big brood of Texans– The Stanley Brothers— and their story of creating “Charlotte’s Web.” These bros–and other founders– were rewarded with a $105Mil CWEB share offer out last week, part of larger plans to raise $300-$400Mil. for CW expansion. See the interview here.
–Based in Denver, Dr. Lloyd Covens, DBA is a seasoned cannabis industry journalist and the publisher of West420 NewsWeekly. Writing his doctorate on diffusion of innovations, Covens has been an expert journalist/researcher for 20 years chronicling new technology, global television and renewable energy advancements. He has reported on developments in the cannabis and hemp industry with weekly reports since 2014 covering the western U.S. for legal medical cannabis, recreational sales and hemp production. Covens is also the creator of the annual CO Hemp CBD conference held in Pueblo, Colorado.