Deep Dive: WA pot sales decline for first time in the decade since legalization

Image: SEATTLE TIMES 

Washington state’s cannabis sales slowed this year for the first time since the state began legal adult-use cannabis sales in 2014.

Retail cannabis sales declined 8% from 2021 to 2022, a loss of about $120 million in revenue, The Seattle Times reported.

Here are 3 takeaways .

1. The New Normal?

Brian Smith, spokesperson for the Washington State Liquor and Cannabis Board, characterized the “dip” in sales as returning to normal after the boom times of the COVID-19 pandemic lockdowns. Similar sales trends are playing out in other recreational cannabis markets.

A study by Seattle-based data analytics firm Headset found that the frequency of marijuana purchases at retail stores and the money people are spending has been declining in those states since the summer of 2021, according to the Times.

2. The Decline

In Washington state, Headset found the average consumer purchase of marijuana dropped from $34.14 in July 2021 to $31.41 in July 2022. Since Washington state legalized adult-use sales 10 years ago, the market has been a success – but not for everyone, as many companies face stiff headwinds.

Challenges include high taxes, a lack of access to capital, low wholesale prices and limited social equity opportunities for minority marijuana entrepreneurs.

3. Other issues involved?

Like other long-running adult-use cannabis markets such as Oregon and Colorado, Washington state growers are experiencing low wholesale flower prices as cultivators continue to flood the market.

Another complaint among industry officials is the lack of access to capital because, by law, cannabis business entrepreneurs must reside in Washington state for at least six months before obtaining a license.

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One possible solution to many of the challenges in the market has been the potential advent of interstate commerce in the event of federal legalization. 

Access to capital also factors into interstate commerce. Washington companies would need to scale up quickly if the state wants to function as an export market, which seems likely with its abundant sun-grown cannabis.

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• WA pot sales decline for first time in the decade since legalization [SEATTLE TIMES]