Despite the effect of the coronavirus pandemic on various industries, the cannabis industry in Oregon has persisted, with forecasts showing that cannabis sales will continue to increase. An economic forecast report released by analysts with the Office of Economic Analysis in the state’s Department of Administrative Service stated that while cannabis sales in the winter aligned with forecasts, sales in the recent months had grown.
The report notes that it isn’t clear whether the cannabis sales data shows increased spending power from stimulus checks that were sent out in March or a growth in demand for marijuana products. It does highlight, however, that other states where the plant is legal, such as Illinois, have recorded similar trends in their marijuana sales during this pandemic period.
In the report, the economic analysts stated they were focused on how much the demand for recreational cannabis would increase in the near future. They explained that they were using federal data collected on the proportion of the adult population who use marijuana, noting that in the state, the rate has been about 20%, which may indicate slow sales in the future. However, the analysts added that the information could be biased given that this was a federal survey and cannabis is still illegal at the federal level.
Generally, the analysts noted that they expected cannabis sales in the short term to remain on the higher side because of an economy with options of entertainment that aren’t fully reopened, strong household finances and the ongoing pandemic. They add that as factors related to the pandemic are resolved into the fall, sales will slowly decline.
However, cannabis sales in the long term are expected to grow. The analysts speculate that this may be brought about by an increase in wages as well as a growth in the state’s population, which will boost demand. Prior projections showed relatively minimal growth in the future as the recreational cannabis segment matured. The analysts assert that while this assumption fundamentally remains unchanged, growth may still increase, prompted by underlying gains in the economy.
Recent projections for marijuana tax revenue in the state show that more than $300 million will be generated in the 2019–21 biennium. The analysts note that this figure will continue increasing each biennium, surpassing $450 million in the 2027–29 period. Currently, some of the tax generated is being used to finance the expansion of the state’s substance misuse treatment.
Last year, voters in the state passed a drug decriminalization measure that called for some cannabis tax revenue to support these services.
Those impressive projections might be viewed as a silent acknowledgement of the different sector players, including Chalice Brands Ltd. (CSE: CHAL) (OTCQB: CHALF), that have done a lot to bring to market products that consumers are drawn to.
NOTE TO INVESTORS: The latest news and updates relating to Chalice Brands Ltd. (CSE: CHAL) (OTCQB: CHALF) are available in the company’s newsroom at https://cnw.fm/CHALF
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