When compared to 2021, Colorado has been generating less revenue from the sale of cannabis and this is a trend that we are highly focused on.
The year got off to a slow start for Colorado’s cannabis industry and the state reported a $35 million decline in sales in January when compared to same month in 2021. The trend so far this year has been consistent and sales per month have been lower when compared to the prior year.
Although we are bullish on Colorado’s cannabis industry, we believe the drop in sales is significant and is a trend to be aware of. In the first four months of 2022, the state has generated more than $650 million of cannabis sales. While we expect the state to exceed $1.4 billion of sales in 2022, this amount is well below what was reported in 2021.
During the last three years, there has been a significant increase in the number of states that allow for the sale of recreational cannabis. Although we believe this factor has impacted Colorado’s cannabis industry, we are surprised by the drop in sales so far this year.
According to the Colorado Department of Revenue (CDOR), the state generated more than $2.2 billion of cannabis sales in 2021. Although many analysts believe the market is nearing peak annual cannabis revenues, we consider to be bullish on the opportunity. Based on last year’s data, Colorado’s cannabis industry is entering a more challenging sales cycle and we will be monitoring how the sector performs this summer.
During the last year, we have seen a large increase in the number of companies that own cannabis assets in Colorado and believe an uptick is sales in the summer would be a catalyst for the sector.
Going forward, we continue to have a long-term bullish outlook on the United States cannabis industry and believe that Colorado is an important market for it. As long as states like Illinois, Michigan and Pennsylvania, continue to record strong growth, we believe the industry is poised to bounce back.
If you are interested in learning more about the US cannabis industry, please send an email to email@example.com with the subject “US Cannabis” to be added to our distribution list.