If you’re a cannabis consumer, you’ve likely wondered what state sells the most cannabis. The answer isn’t an exact science, and there are many factors involved. However, here are the top five states with the highest sales.
Illinois
Illinois is among the states that has legalized marijuana, and is on the way to generating billions of dollars in sales by the end of the year. While the state will likely exceed its $1.5 billion target for total cannabis sales in 2020, the next two years are expected to be much larger.
In January, the State of Illinois legalized recreational adult use cannabis. The law allows residents to purchase pot legally from licensed retailers. Marijuana is also subject to a sales tax. Tax rates vary by product and location.
During the first 10 months of the year, Illinois dispensaries sold $1.2 billion in pot products. By the end of the year, the state expects to have generated $1.8 billion in total retail cannabis sales.
Illinois is on pace to double last year’s sales. New licenses are being issued to growers, manufacturers, and retailers. This will expand the state’s adult-use cannabis footprint to more than double its current 110 dispensaries.
Illinois’ adult-use cannabis market recorded its largest four-month stretch since the program began. A total of $1.5 billion in sales helped local governments earn $146.2 million.
Adult-use retailers have reported a 20% increase in revenue for the first quarter of the year. Illinois has also seen a substantial increase in the number of out-of-state customers. These shoppers accounted for almost a third of total revenues in 2021.
New York
New York’s marijuana industry has been slow to develop. It has yet to launch its adult-use market, which is expected to generate $1.3 billion in revenue by 2021. Fortunately, some state officials are taking steps to help grow the business.
The state has reserved the first round of retail licenses for people with convictions on drug offenses, such as possession and selling. It is also planning to create a public-private fund to support “social equity” applicants.
However, many applicants have been stalled in the approval process. One of the main reasons is that regulators have not fully developed regulations and requirements for the new industry.
To date, more than 900 conditional adult-use retail dispensary applications have been submitted. Of these, the Office of Cannabis Management (OCM) has only announced a handful of approved applicants.
Another major challenge is the lack of experienced workers. A robust delivery service is crucial for licensed retailers to compete with unauthorized sellers.
During the conference, a social-equity program was introduced to give people with criminal records the opportunity to work in the legal marijuana industry. Other programs include training in management skills, leadership, and entrepreneurship.
The state has allocated the money from marijuana sales to revitalize communities. It will also invest in mental health services, housing, and public schools.
California
The California cannabis market is the largest in the world. Sales are estimated to reach $4.4 billion in 2020. This market includes the sale of cannabis for medicinal and recreational purposes.
According to the California Department of Public Health, there are more than 900 licensed dispensaries in the state. These shops have sold $450 million in medical marijuana in just one year. Despite these sales, the industry is still largely illicit.
There are roughly 3,000 unlicensed retailers operating in the state. Many dispensaries underreport sales.
As a result, the illegal market is thriving. In fact, the illicit market accounts for over half of all the sales in the California marijuana market.
While the California government has made strides to curb illicit activity, there are still billions of dollars flowing into the illicit market. An estimated 50,000 cannabis cultivation sites are believed to be using pesticides banned by the state. They are also thought to be responsible for stealing millions of gallons of water from their neighbors.
As frustration grows over the legal cannabis industry, frustrated users are turning their attention to local control. A number of cities and counties have recently opted out of regulated sales.
Some have passed more restrictive ordinances. Redondo Beach is on track to approve a 5% tax rate for dispensaries.
Vermont
Vermont is among the first states to legalize adult-use cannabis. The state’s first stores opened on the weekend of October 1st. Retailers say they will generate $3 million to $5 million in recreational sales this year.
Stores have been opened in Montpelier, Barre, Derby, Brattleboro, and other towns. But it could be months before retailers are fully stocked with products. They will likely have a limited number of vendors, but consumers should be ready to purchase weed.
Vermont’s recreational marijuana market is set to grow substantially in the coming years. By 2026, retail sales are projected to total $120 million to 145 million. This is a huge increase over medical marijuana sales estimates of $10 million to $12 million.
In the month of October, retail cannabis stores in Vermont sold $2.4 million in weed. That’s more than one pound of flower for every resident. However, many retailers have voiced concerns about the limited supply of products.
One store in Burlington is expected to be the first of the state’s recreational marijuana stores to open. Ceres Collaborative, which has four medical locations in the state, is preparing to sell adult-use weed.
It took about 45 minutes for the doors to open on the first day of retail sales. The line stretched down the alley toward a restaurant. At the front of the line was Bryan Menard, who was awaiting his first adult-use weed purchase. He planned to buy a $100 jar of cannabis flower and drink a Sip of Sunshine ale brewed by Lawson’s Finest Liquids, a Waitsfield-based company.
Arizona
Arizona is among the most cannabis-friendly states in the country. It is home to many quality marijuana dispensaries, and the market seems to be growing. This is because Arizona has legalized recreational and medical marijuana, and has a tax structure designed to stimulate participation.
The state’s Department of Revenue (DOR) tracks sales of marijuana. For the first year of legalization, the state generated $1.9 billion in retail and medical sales. Of that, $703 million was medical marijuana.
Arizona also saw strong growth in the medical cannabis market. In the first year of legalization, the market surpassed other states.
Medical marijuana is taxed at a rate of 5.6 percent, and patients will pay $16 per $100 spent. Arizona has also implemented a hefty excise tax on recreational sales, which is designed to fund education and county health departments.
There are more medical marijuana dispensaries than any other state, and more than a hundred are licensed to sell recreational products. However, many dispensaries do not properly report their sales. These data are kept to ensure compliance.
Overall, the state of Arizona is on track to eclipse $221.3 million in taxes from marijuana sales in 2021. During the first year of legalization, the state saw stronger sales than other states, with an average of $22 million in excise taxes a month.
Oklahoma
Oklahoma sells the most cannabis of all 35 states. The state has 2,000 dispensaries. It’s also home to the nation’s largest medical marijuana program. And the market is growing.
Although it is still in its early days, the market for medical marijuana is thriving in Oklahoma. A recent survey found that a fifth of Oklahoma’s population (about 369,247 people) has a medical marijuana card. That number is up from a mere 1.6 percent in 2018. This means that there are more MMJ patients in the state than any other.
One of the major reasons for the growth is the ease of getting a recommendation from a physician. There are about 220 doctors in the state who have voluntarily registered to see MMJ patients.
Another reason is the low barrier to entry. The cost to get a business license is just $2,500. Also, Oklahoma does not limit the number of licenses.
The state’s low barriers to entry have made it the launchpad for thousands of small businesses. But a sluggish economy and an overabundance of retail options have caused some dispensaries to shut their doors.
Another factor is the high number of non-violent drug offenders serving lengthy prison terms. Oklahoma imprisons more people on a per-capita basis than any other state.
Nebraska
The most common form of illegal drugs in Nebraska is marijuana. It is sold in strip clubs, businesses, bars, and residences. Most of it is produced in Mexico.
According to the Nebraska Department of Public Safety, more than 3.5 percent of the state’s residents reported abuse of cannabis in the month before the survey was taken. In addition, 48 percent of arrestees tested positive for marijuana in 2000.
In the late 1990s, the Nebraska State Patrol discovered a sophisticated cannabis cultivation operation in the basement of an Omaha home. Three years later, the Drug Enforcement Agency/State Police (DCE/SP) seized seven outdoor plots.
In 2000, a total of 18 indoor grow operations yielded 560 plants. A large portion of the marijuana in Nebraska is cultivated outdoors. Marijuana is usually transported in a concealed compartment in a car or truck, hidden in a duffel bag or metal box.
Although legal in most states, Nebraska’s laws prohibit the possession of marijuana. Possession of one ounce or less is a misdemeanor, while possession of more than an ounce is a third offense, punishable by up to $700 in fines. If the substance is found on a second offense, the maximum penalty is $500.
