Colorado Archives - Page 2 of 2 - Green Market Report

Jack SmithAugust 3, 2018
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5min11770

Despite initial fears that Colorado’s regulated marijuana market might only fulfill part of the demand from consumers, a new study shows those fears are overblown.

The study, produced by The Colorado Department of Revenue (DOR)’s Marijuana Enforcement Division, shows that in 2017, the regulated market was able to meet both resident and visitor demand for cannabis. That compares to 2014, when only 65 percent of consumption came from the regulated market. The new data shows that consumers are moving from marijuana flower, towards concentrates, which highlights a competitive market.

“This update improves upon the original 2014 market study methods and uses official market data to provide an updated insight to and assessment of Colorado’s regulated marijuana markets through 2017,” said Mike Hartman, DOR executive director in a statement provided to Green Market Report.

Hartman added: “This report gives me comfort that the licensed, regulated commercial marketplace is working well and is part of the state’s continuous effort to monitor a comprehensive marijuana regulatory framework, improve transparency and use data to inform the public about Colorado’s marketplace.”

In 2017, 340.7 metric tons of flower were regulated in the state. 301.7 metric tons went towards sales to consumer, while 34 metric tons went towards inventory and the remaining 6 were for residual marijuana.

The Colorado market continues to be a competitive and diverse area for consumers, with no one company dominating the market. The DOR report actually noted that the 10 largest operators in the state saw a decline in market share, coming in at 23.1 percent in 2017, down from 25.4 percent in 2016 and 26.6 percent in 2015.

Prices are also coming down, as the market remains extraordinarily competitive. Marijuana flower prices have “declined slowly,” according to the DOR, while the price of a standard serving of THC has “declined more rapidly.”

Though pricing trends are largely coming down, there are still some variances in different parts of the state. In mountain and border towns, consumers will pay between $8.30 and $11.75 per gram for flower, compared to $5.79 per gram for the average.

In 2017, flower comprised 61.8 percent of the market, while concentrate made up 27.3 percent, trim accounted for 5.9 percent, with infused edibles and infused non-edibles accounting for 4.9 percent and 0.3 percent, respectively.

Other highlights from the study include Colorado’s attitude towards using technology to make it easier to respond to ever-changing consumer needs, while also keeping up with regulations.

“Colorado is the first state to use inventory tracking data to understand market dynamics; the first to use flower equivalent measures; and the first to compare supply, demand, and consumption to monitor regulatory performance,” Adam Orens, Founding Partner of Marijuana Policy Group, said in a release accompanying the study.

Orens added that the findings are important to show that the cannabis market can be regulated effectively and is a sign of the “evolution of regulated cannabis markets – where governments are monitoring market data and adjusting policy accordingly.”


Jack SmithMay 23, 2018
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6min31130

BDS Analytics has issued a new report on the public attitude towards marijuana in Colorado and there has been a strong movement towards more positive perception, as the state continues to embrace its cannabis culture.

The study, which was conducted from Jan. 16, 2018-Feb. 13, 2018 and ensured all participants were 21 or older, noted there has been “a substantial increase” in Colorado adults consuming marijuana, compared to the first-quarter of 2017. The researchers also found that adults were more open to exploring cannabis in different forms, though they did have prior cannabis experience or were open to using it in the future.

Colorado continues to be among the few states with legalized marijuana for recreational use and it’s clear its residents are taking advantage of that. The state saw a 12 percent increase in dollar sales year-over-year from the first-quarter of 2017 to the first quarter of 2018, according to retail sales that BDS tracks.

Among those who are consuming, BDS found Colorado’s consumers as skewing slightly older and more likely to be male. The consumers are also more likely to see it as medicine, consider themselves “connoisseurs” and claim that cannabis is part of their everyday routine.

There’s also been a shift in using it towards health and wellness benefits, especially for pain management and belief.

Here are 9 of the most interesting facts from BDS Analytics’ findings about the Colorado cannabis market.

1. Consumption is going up.

BDS found that 35 percent of Colorado residents consumed marijuana in the first-quarter of this year, as opposed to just 25 percent in the first-quarter of last year.

2. Rejectors are less likely to support it now.

Marijuana became legal to purchase in Colorado in 2014 for anyone over the age of 21 for any purpose, making it the first place in the world to have that distinction. Since then, however, rejectors have become more entrenched in their thinking.

Just 63 percent of rejectors would support legalization now, compared to compared to 80 percent in the first-quarter of 2017. In total, 85 percent of respondents think there should be some form of legal marijuana use. Perhaps not surprisingly, 99 percent of consumers who’ve used marijuana in the past six months think it should be legal in some form.

3. Health benefits.

Sixty-eight percent now believe marijuana has some health benefits, including 68 percent who believe it can relieve pain, 61 percent believe it can help with the side effects of chemotherapy and 55 percent believe minors should use it if okayed by a doctor and with parental consent.

4. Relaxation usage going down.

People who said they were using it for relaxation benefits went down year-over-year. Thirty percent said they were using it for relaxation (things like managing anxiety or stress) in the first-quarter, compared to 34% in the first-quarter of 2017.

5. An evening hit.

Consumption of marijuana is favored mostly in the evening, though the study noted that consumers are partaking in their usage throughout the day.

6. Methods are shifting.

The way people are consuming marijuana is shifting, if just a bit. They continue to prefer inhaling it, but topical use is also growing. 79 percent of consumers inhaled it in the first-quarter of 2018, compared to 67 percent in the first-quarter of 2017.

7. Gummy divine.

For those who prefer to consume it using edibles, gummy candies reign supreme.

Fifty-four percent of respondents say they have consumed gummy candies in the past six months. Forty-nine percent say they have consumed baked goods, 44 percent say they’ve eaten chocolate candy and 36 percent say they’ve eaten hard candy in the past six months.

8. Topical.

Salves are the most preferred way to consume it by topical consumers, but lotions and creams also receive heavy usage. Thirty-four percent say salves or balms are the most preferred way to use it.

However, of those who have applied it topically in the past six months, lotions comes in at 45 percent, creams at 43 percent and salves or balms at 41 percent.

9. Where to buy?

Overwhelmingly, Colorado consumers prefer to purchase their marijuana from a dispensary, at 90 percent, compared to 88 percent in Q1 2017.


StaffJanuary 18, 2018
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The State of Colorado released its full-year 2017 marijuana sales tax collections and the medical marijuana market continues to decline as users make the switch to recreational marijuana. The initial data showed that medical marijuana sales had slowed, but now the latest report demonstrates that sales are actually declining.

Matt Karnes, founder of GreenWave Advisors said that his estimates were remarkably close to the actual results. Medical marijuana sales were down year-over-year to $420 million in the full year 2017 versus $430 million in 2016 ’16. Recreational marijuana sales increased 30% year over year to $1.074 billion. His full year implied revenue estimates were $1.458 billion and the actual amount beat his estimate by 2% at $1.494 billion. This was an increase of 19% over 2016’s $1.256 billion

Karnes also believes that medical marijuana cardholders will decline as well. December figures haven’t been released yet, but he expects to see further deterioration in this area. “The disruption to the growth rate of a medical marijuana market when recreational use is legalized in a particular state is an outcome that we anticipated in 2014 when we launched coverage of the cannabis sector,” said Karnes. “This trend is important to note for those interested in obtaining a medical marijuana license in a newly legalized state because this initial permission basically serves as a call option for when a recreational market is established.”

Colorado has collected $247,368,473 in marijuana taxes, licenses, and fees for 2017. This tops the   $193,604,810c that the state collected in 2016. Colorado reported that in 2017 (Jan – Nov) the state logged $1,379,429,765 in marijuana sales and to date since 2014 it was $4,365,748,232.

The state is pushing back against the Justice Department that recently rescinded the Cole Memorandum that provided some level of protection to the cannabis companies. The Cannabist reported that “Colorado lawmakers, including Representatives Ed Perlmutter, Diana DeGette and Jared Polis, and Sen. Cory Gardner, held a call to strategize on a push on marijuana-related measures — specifically crafting a spending bill provision to restrict the Justice Department from interfering with laws in Colorado and the 45 other states that have legalized cannabis in some form.”

 


Debra BorchardtDecember 13, 2017
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4min18510

The state of Colorado is now releasing sales data on marijuana transactions. Previously, the state only posted tax revenues, leaving researchers and journalists with guesswork as to how that translated into sales. So far, total sales through October have increased 42% year-over-year and tax revenues through November have increased 16%.

On Wednesday, the state released medical and retail sales data going back to January 2014, even though sales began prior to this date. Going forward, monthly reports will be published on the seventh business day of each month. The data is self-reported by the businesses and aren’t audited or use the Metrc tracking system.

“We know this information is highly desired by the general public, media, and researchers,” said Mike Hartman, executive director of the Colorado Department of Revenue (CDOR). “To that end, in our efforts to be as transparent as possible, we will now provide aggregate sales data. That, coupled with state tax revenue data already provided, will give an accurate picture of the financial footprint of this burgeoning industry.”

Marijuana Sales Reports

Calendar Year Total Marijuana Sales Total to Date
2014 $683,523,739 $683,523,739
2015 $995,591,255 $1,679,114,994
2016 $1,307,203,473 $2,986,318,467
2017 (Jan – Oct) $1,259,861,988 $4,246,180,455

Updated December 2017

Calendar year is defined as January 1 – December 31

 

The Department of Revenue also stated that the Office of Research and Analysis would produce monthly reports that would show the total sales for retail and medical marijuana by county. Plus, the ORA will calculate a cumulative total of actual sales figures from year-to-date and total sales per year. The sales reports will be posted on the same day as the tax reports.

Colorado changed its marijuana sales tax on July 1, 2017. Retail sales taxes rose from 10% to 15%. Retail products were exempt from sales tax on personal property. So far in 2017, the state has collected $226 million in total marijuana tax, license and fee revenues.

Marijuana Taxes, License, and Fee Revenue

Calendar Year Total Revenue
2014 $67,594,323
2015 $130,411,173
2016 $193,604,810
2017 (Jan-Nov) $226,157,028

Updated December 2017

Calendar year is defined as January 1 – December 31

 


Melissa EbanksSeptember 27, 2017
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In November of 2012, twelve years after legalizing medical marijuana, Colorado voters approved a measure to legalize recreational marijuana use. The state adopted a model that allowed only existing marijuana dispensaries to convert to retail establishments.

New research from the Wisconsin School of Business at the University of Wisconsin–Madison reveals that property values in the immediate vicinity of Denver’s retail marijuana establishments increased by more than 8% since the law took effect on January 1, 2014.

Moussa Diop, Wisconsin School of Business assistant professor of real estate & urban land economics, along with James Conklin of the University of Georgia and Herman Li of California State University, say the relationship between the price of houses and retail conversions is particularly important with voters in four states legalizing recreational marijuana use last November and others likely to follow.

“The presence of retail marijuana establishments clearly had a short-term positive impact on nearby properties in Denver,” says Diop. “This suggests that in addition to the sales and business taxes generated from the retail marijuana industry, municipalities may experience an increase in property taxes. It’s an important piece of the puzzle as more and more voters and policy-makers look for evidence about the effects of legalizing recreational marijuana, as the issue is taken up by state legislatures across the country.”

Single family residences within 0.1 miles of a retail marijuana establishment saw an increase in value of approximately 8.4 percent compared to those located slightly further—between 0.1 miles and 0.25 miles—from the site. That increase in property value was estimated to be almost $27,000 for an average house in the area.

While the study did not seek to identify the underlying drivers of what led to an increase in property values near retail conversions, the authors did identify potential explanations including: a surge in housing demand spurred by marijuana-related employment growth; lower crime rates; and additional amenities locating in close proximity to retail conversions.

The findings are in line with a 2016 study that identified a six percent increase in housing values on average in municipalities across the state of Colorado that allowed retail marijuana sales. Colorado’s model of allowing only existing medical marijuana dispensaries to convert to retail establishments was also used in Oregon and will be implemented in Nevada. Other states may follow that same procedure, as the adoption of medical marijuana laws is typically seen as a first step to broader legalization efforts.

The study relied on residential property information from the City of Denver’s Open Data Catalog and a list of retail licenses granted by the Colorado Department of Revenue, the agency responsible for administering the new law.

The paper, “Contact High: The External Effects of Retail Marijuana Establishments on House Prices” will be published in Real Estate Economics.


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