Cautious optimism is overarching theme for growth industry despite new challenges
Las Vegas, NV, November 16, 2022—MJBizCon, the largest B2B cannabis event in the world, returned to the Las Vegas Convention Center this morning. The 11th annual MJBizCon kicked off Wednesday morning, welcoming tens of thousands of cannabis professionals for the industry’s premier event. Despite challenging economic conditions, industry growing pains and geographical regulatory hurdles, the overall sentiment is cautious optimism as the industry matures.
The CEO and founding editor of MJBiz, Chris Walsh addressed attendees with his always anticipated “State of the Industry and Predictions for 2023’” But, unlike years past, there was a focus on the good, the bad – and the ugly.
“There is still have a lot to be celebrated in this growing market, such as new states legalizing and potential federal reform,” said Walsh. “It’s easy to get lost in all the present-day challenges and growing pains, but zoom out to the longer term and there is still exciting industry growth and opportunities ahead. We just have to buckle down and drive through the storm–riding the green wave isn’t going to be enough in these economic conditions.”
Good – Overall industry sales are still growing at an impressive level. Four new recreational markets opened up and three more are gearing up. Democrats kept the Senate, which could be favorable for cannabis change. There are impressive mainstream companies breaking ground: Uber Eats entering the delivery space in Canada, Major League Baseball has a prime CBD sponsor, and Circle K is teaming up with medical dispensaries in Florida.
Bad – Sales in some of the most mature markets, such as Colorado, Washington, and Oregon, have stagnated or declined. A price decline for wholesale cannabis in many markets is causing retailers to discount heavily. In states without license limits, there are too many players. Companies are restructuring and scaling back. This month’s elections saw three ballot measures fail, proving that breaking through in red states will be challenging.
Ugly – Cannabis capital has collapsed. Investments are down significantly. Companies structured based on last year’s environment and dependent on capital are struggling. California, the largest cannabis market in the world, is seeing the illicit market gain ground as regulations and cost compliance are negatively effectively the legal industry.
Walsh offered several predictions for 2023, including:
- Banking reform federally will materialize in 2023,
- New York will struggle to contain illicit market after adult-use launches,
- Major consolidation to come in key markets, such as Michigan and California,
- The Biden administration will make tangible progress on de-scheduling or re-scheduling cannabis, and
- Two more states will legalize cannabis, possibly Ohio, Pennsylvania, or Minnesota.
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