Cannabis Retail Sales Rise 13%, Hitting $589 Million In Legalized US Markets
Legalized marijuana sales in the five-largest markets rose 4% from November, reaching a combined $589.3 million, a 13% rise year-over-year.
That’s according to the December Cannabis Retail Price Index (CPI), the latest report from cannabinoid market research firm BDS Analytics.
The figure is indicative of a traditional relationship; December is typically a month in which gains are realized across most product categories. The category share of flower declined approximately 1%, while vape and ingestibles increased 0.5%, a rebound following industry-wide losses due to the September vaping death health scare.
The Cannabis CPI hit 102.13 in December, a 0.1% increase from the previous month. The CPI is designed to illustrate demand shifts, pricing adjustments and other trends in the cannabis industry for consumers, producers and investors. Through its GreenEdge Platform, BDS compiles transaction pricing data for dispensaries in Arizona, California, Colorado, Nevada, and Oregon, which make up 50% of the United States’ legalized cannabis product sales.
The index shows a neutral to positive price trend in pre-rolled joints and topicals on a year-over-year basis, while flower, vape, ingestible and dabbable concentrates continued experiencing negative price pressures.
Despite the lower prices amongst most product categories, sales rose alongside the CPI, a result of revenue growth favoring categories with higher base prices, such as ingestibles, vape and dabbable concentrates, according to BDS. Though cannabis continues to make headway on the legalization and regulatory fronts, many cannabis stocks are still at their lows, further exacerbated by the recent broad-market sell-off.
Despite the low stock prices, there’s a belief that the industry will rebound. According to BDS, cannabis sales tend to historically spike in December, and optimism remains high among industry insiders that investor money will flow back in, now that valuations have come down.
At the recent Benzinga Cannabis Capital Conference in Miami, Florida, investors, companies and thought leaders expressed their beliefs regarding the future prospects of the industry.
“We’re at an inflection point,” said Columbia Care Inc., (OTCQX: CCHWF) CEO Nicholas Vita. “People will need to make a choice if they will take a Tylenol or something with cannabis,” he added in a reference to the emerging notion that cannabis is a solution for the next logical consumer.