Cannacurio #90: Annual Summary 2023

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2023 was a unique year for cannabis licensing. The industry decline continued, the number of licenses declined, fewer new licenses were issued, and Oklahoma's moratorium finally went into effect. Here are some metrics to compare 2023 to previous years.

• In 2023, 5,132 new cultivation, manufacturer and store licenses were issued, up from 9,853 in 2022
• Oklahoma has stopped issuing new licenses and heavily regulates existing licenses
• There were 39,291 active licenses at year-end, down 7% from 2022

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Cultivation licenses accounted for 46% of new licenses in 2023, down from 58% in 2022. Stores accounted for 36% of new licenses, down from 28%; and new production licenses were 18%, up slightly from 14% in 2022. None of this is a surprise given the moratoriums, oversupply and sentiment surveys we have conducted.

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Here is the state-by-state leaderboard for 2023, with Michigan taking the crown:

Cannabiz Media divides the US into the following regions: Northeast, Southeast, Midwest, Southwest and West. In 2022, 72% of new licenses issued came from the Southwest and West. Oklahoma and California were each the drivers in these regions. The chart below compares 2022 and 2023, with the Northeast, Midwest and Southeast being relatively stable year-over-year.

southwest

One final point about Oklahoma: Cannabiz Media Intelligence platform data shows that the total number of licenses in the state is shrinking and that there are almost no new licenses after February 2023. An important dynamic is shown in the following graphic, which highlights the high number of licenses issued in January and February – representing the last gasp of the Oklahoma licensing machine. The state issued 830 of the 1,441 licenses issued statewide (58%). Over the next ten months, Oklahoma was responsible for only 116 of the 3,691 licenses issued (3%)!

Four states accounted for 75% of the 2,345 new cultivation licenses in 2023: Michigan, California, Oklahoma and Vermont. However, the new cultivation licenses represent only a fraction of the licenses issued in 2021 and 2022.

Manufacturing

Manufacturing licenses remained stable from 2022 to 2023. Our recent post shows that the total number of licensed and active licenses has changed by approximately 20 licenses year-over-year.

Pharmacy/Retail

The number of stores or doors is an important metric for cannabis. The chart below shows growth in both deals and licenses over the last twelve months. It's interesting to compare these numbers to other places where people can buy CBD and e-cigarettes. For example, in Florida there are over 10,000 establishments licensed to sell CBD, and in New York there are over 8,000 licensed vape sellers. This opens up a lot of choice for consumers who likely don't know or care about the licensing status of a particular establishment.

As we said above, 2023 was a challenging year for licensing and 2024 will bring a whole new set of issues:

• New Hampshire — The governor proposed modeling the state program after his liquor model, which is sold through state stores.
• Georgia – The state has granted permission for independent dispensaries to sell low-THC oil to patients. The FDA was not happy.
• new York – The country was expecting many more licenses than were issued and the governor has expressed her displeasure – could there be changes at the commission?
• Virginia – Members of both houses of the Virginia Legislature approved competing measures to legalize and regulate retail sales of cannabis. Adult sales likely won't begin until 2025.

Other key launches include social equity licenses in Maryland and many hundreds of licenses in New York. Cannabiz Media will continue to pursue these and all other initiatives. We'll be back in April to report what happened in the first quarter of 2024.

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For a visual representation of all this information, see the 2023 Year-End License Ranking Summary post here.

Ed Keating is co-founder of Cannabiz Media and oversees the company's data research and government relations. Throughout his career, he has worked with and advised information companies in the compliance area. Ed has led product, marketing and sales while overseeing complex, multi-country product lines in securities, corporate, UCC, security, environmental and human resources.

At Cannabiz Media, Ed enjoys the challenge of working with regulators around the world as he and his team collect corporate, financial and licensing information to track the people, products and companies in the cannabis economy.

Ed graduated from Hamilton College and received his MBA from the Kellogg School of Northwestern University

Cannabiz Media customers can stay up to date on these and other new licenses through our newsletter, alerts and reporting modules. Subscribe to our newsletter to receive these weekly reports straight to your inbox. Or you can schedule a demo to get more information about how you can access the Cannabis Market Intelligence Platform yourself and dive deeper into this data.

Cannacurio is a weekly column from Cannabiz Media featuring insights from the most comprehensive cannabis market intelligence platform. Check out Cannacurio posts and podcasts for the latest updates and information.