After only 10 months, Colorado cannabis retailers have already broken 2019’s record for single-year sales.
Marijuana Sales in Colorado: By the Numbers
By the end of 2018, Colorado’s cannabis market appeared to be flattening out. Transactions were growing, but price compression caused the year-over-year growth rate from 2017 to 2018 to fall to a meager +2.5%. But then, with changing consumer behavior and an influx of new non-flower products, cannabis sales began to surge. Pot retailers’ sales skyrocketed past projected figures, and by the end of the 2019, sales had increased by 13% over the previous year – with the state selling nearly $1.75 billion worth of marijuana products.
Now, a year later, and Colorado is crushing previous records once again. According to figures presented by the Department of Revenue, October marijuana sales in Colorado climbed to over $199.7 million – approximately $170 million in adult-use recreational products and $38.8 million in medical marijuana products. That massive number adds to the already impressive total reported by the state in previous months, bringing Colorado’s current total sales to a bit over $1.8 billion. With November and December data remaining to be collected, Colorado is on track to surpass $2 billion in cannabis sales for the first time since the state launched the program in 2014.
Where Does Colorado’s Marijuana Money Go?
With $1.8 billion in marijuana products sold so far in 2020, Colorado has already raked in over $355 million in tax revenue this year. Out of that hefty sum, 10% (about $35 million) is funneled into local communities and distributed how they see fit. The remaining 90% – the state’s share – is put toward various public funds such as the Marijuana Tax Cash Fund, the B.E.S.T. Public School Capital Construction Assistance Fund, the Public School Permanent Fund, and the Public School (K-12 Education) Fund.
The Marijuana Tax Cash Fund is used to benefit health care, health education, substance abuse prevention and treatment programs, and law enforcement. The BEST Capital Construction Assistance Fund was created for the purpose of providing financial assistance to local school districts under the Building Excellent Schools Today (BEST) Act. The Public School funds funnel marijuana tax revenue into the Colorado Department of Education. From there, the funds are distributed in a few different directions, such as school bullying prevention, early literacy, school health professionals, drop-out prevention, and education grants. In a year where COVID-19 has ravaged industries and caused widespread recession, the money generated by legal pot has truly benefited Colorado.
COVID-19’s Impact on Colorado’s Cannabis Market
While the coronavirus pandemic has led to economic hardship in just about every area, the marijuana industry has not only sustained – it’s surged. Colorado’s October cannabis sales of $199.7 million, though down 3.2% from September’s total, were up over 32% from October 2019. Furthermore, data shows a significant spike in cannabis sales around the same period when COVID-related restrictive measures were being put in place.
According to New Frontier Data, legal marijuana sales increased by nearly 50% from March to April 2020 in key legal markets across the US. In Colorado specifically, while the state has lost an approximate $8 billion in tourism since March, marijuana sales have increased by 20% or more every month in a year-to-year comparison between 2020 and 2019. Despite a global pandemic and widespread recession, the cannabis industry is still moving forward vigorously – with states like Illinois and Ohio also joining Colorado in setting record sales over 2020.
Through budget shortfalls and struggling economies, marijuana sales continue to climb, with cannabis markets bridging a widening financial gap in many legal states.
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