Cannabis License Trends – Markets To Watch

Cannabiz Media has been tracking licenses since 2015 and captures market intelligence on the ebb and flow of these state programs.  In looking at calendar year 2023, we have outlined the markets that dominate, the states that are growing, and the activities securing the most licenses,

Cannabiz Media has been tracking licenses since 2015 and captures market intelligence on the ebb and flow of these state programs.  In looking at calendar year 2023, we have outlined the markets that dominate, the states that are growing, and the activities securing the most licenses,

Overview

Cannabiz Media is tracking over 41,000 active US cannabis licenses. Due to the restrictions on interstate commerce and other impediments, each state is free to devise their own licensing scheme.  This has led to our current situation where 51% of all the US licenses are in either California or Oklahoma.

The ten markets in the table represent 86% of all the active licenses in the US.  The % column shows whether the number of licenses has increased or decreased since the beginning of the year.  There is context that drives the increases and decreases in these states:

Growth

So far this year 36 states have issued at least one cannabis license.  However, new license issuance is similarly concentrated as the existing state footprints.  80% of 2023’s new licenses come from just five states with 90% coming from 10 states.  Here’s the leaderboard:

Timing & Trends

When aggregating licenses across the country, it can be comforting to look for patterns, though we found little predictability form this “Loch Ness Monster” pattern of license issuance.  The spikes tended to be driven by one state dropping a bunch of licenses:

Digging into the top three 2023 license issuers a few things stand out:  the Oklahoma moratorium has taken full effect with new licenses dropping to almost zero; while California and Michigan, for the most part, stayed within a reasonably tight band of new license issuance.

License Types

There is a myriad of activities that state’s license.  The most prevalent are cultivation, sales, and manufacturing.  The table below shows that of the 5,137 new license issued though the end of August, 37% were for cultivation – certainly impacting oversupply and fueling the black market.  

Markets to Watch

We expect to see new licenses in Q4 and into 2024.  Here are a few markets we’ll be monitoring:

• Northeast – Massachusetts, New York and New Jersey. These are large markets that have a lot of licenses left to issue – especially in light of the latest announcements from the New York Cannabis Control Board on September 12.
• California plans to use incentives to get municipalities on board to allow businesses to operate in the various cannabis deserts.
• Moratoria – These three states have moratoria: Oklahoma, Oregon, Montana.  That could mean that the only way into those markets is through M&A.
• Social Equity – We have seen many states adopting these programs, with varying degrees of success.  Here are the latest two entrants: Washington & Maryland.

Author

Ed Keating is a co-founder of Cannabiz Media and oversees the company’s data research and government relations efforts. He has spent his career working with and advising information companies in the compliance space. Ed has managed product, marketing, and sales while overseeing complex multijurisdictional product lines in the securities, corporate, UCC, safety, environmental, and human resource markets.  

At Cannabiz Media, Ed enjoys the challenge of working with regulators across the globe as he and his team gather corporate, financial, and license information to track the people, products, and businesses in the cannabis economy.  

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

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This post was authored by an external contributor and does not represent Benzinga's opinions and has not been edited for content. This contains sponsored content and is for informational purposes only and not intended to be investing advice.