High tariff stem US scannabis industry in the middle of escalating trade voltages

The US cannabis sector is considering significant cost increases due to new tariffs, which were imposed by the Trump administration. On April 2, 2025, President Trump announced a mutual tariff of 34% for Chinese imports, which increased the total tariff for these goods to 54%. In addition, a universal basic tariff of 10% applies to all countries, which further influences the supply chain of the industry.

Industry reactions and adjustments

Cannabi companies face challenges when absorbing these increased costs. Kevin Kuethe, Chief Cultivation and Production Officer at Lume Cannabis in Michigan, found that the company recorded an increase of 2 to 3 cents per sold vape unit, which is considering considerably in view of its high sales volume. In order to mitigate the effects, Lume has prepared preventively via supplies before the tariffs became effective.

Similarly, Jaunty, a cannabis company based in New York, reported an increase in VAPE hardware tariffs to 46%. CEO Nicolas Guarino expressed concerns about the lack of domestic alternatives to the procurement of Vape hardware and emphasized the trust of the industry in Chinese imports.

Wider economic effects

The tariffs not only influence product costs, but also the wider cannabis market. The stocks of the most important cannabi companies such as Tilray Brands, Canopy Growth, Organigram and Terrascend fell between 5% and 10% after the tariff announcements. Analysts warn that increased prices could drive consumers to the illegal market, which further burdens the legal companies.

Lief chain companies also report on slowing down demand and incoming orders, which emphasizes the growing fragility of the market. Brad Wasserstrom, President of the Wasserstrom Co., found that the manufacturers say goodbye to the tariff costs across the board and ultimately influence consumers.

Look ahead

While the cannabis industry navigates these challenges, companies examine alternative sourcing options and re -evaluate their supply chains. However, the lack of an infrastructure for domestic production for key components such as Vape hardware shows considerable hurdles. Industry leaders emphasize the need for a uniform approach for procurement and supply chain in order to reduce the effects of ongoing trade voltages.