There may be an excessive amount of weed in Oregon. There may be not sufficient weed in Oregon.
Permit me to elucidate. On February 1, the OLCC launched its 2025 legislative report on native, regulated marijuana provide. We get these studies each two years, as required by ORS 475C.529. They are typically downers. And this one might be the worst one but.
The report got here in as anticipated; which is to say, each provide and demand are trending badly for Oregon operators. Particularly:
“[t]he retail median price-per-gram of usable marijuana is on the lowest level the market has seen since legalization. The low worth might be attributable to oversupply.”
Costs aren’t simply low. They’ve by no means been decrease. The report confirms the conclusions in my State of the State publish from December 19, 2024, the place I highlighted a static variety of OLCC licensees, a static enforcement setting (inside and outdoors the OLCC system), and Oregon’s largest fall harvest, ever. I predicted downward pricing stress. I may go on and on about all these items, however I don’t imply to bore you, and we’d like some encouraging phrases.
I’ve one other method to consider the report. Oregon is not producing an excessive amount of hashish. We’ve stellar terroir, scrumptious appellations and virtuosic growers. The issue ‘spherical right here is we can’t export it. We will’t ship our report harvest to non-agricultural states, and locations the place hashish can solely be grown in buildings. Listed here are some causes:
- Federal legislation.
Right here is a few colour on that:
- Congress can’t get it completed. The very best we bought was a bill out of the Home in 2022.
- The manager department’s proposed rulemaking might transfer marijuana to Schedule III. Perhaps. However this is able to not enable interstate gross sales.
- The leggiest lawsuit difficult the federal Managed Substances Act wouldn’t enable for interstate commerce, even when they win.
- The export bill Oregon handed in 2019 by no means “goes reside”, as a result of state of federal legislation and coverage.
- Oregon’s legislative efforts across the edges on interstate switch of seeds and such have puttered out.
Early native thinkers just like the Craft Hashish Affiliation (RIP) and Adam Smith have been ahead of their time. Oversupply within the OLCC market has been round since the Oregon program started. Advocates pushing for interstate gross sales and federal legalization are making the one sensible argument.
In the previous couple of years, native business appears to have gone away from this. You’ll hear complaints that we can’t promote hashish to different states, even whereas business litigates in opposition to the prevailing testing standards in different states. In that sense, Oregon shouldn’t be nicely positioned for when the floodgates open.
I do hope the floodgates open. That’s the solely factor that would put an considerable dent in oversupply, even when the fires return within the fall of 2025; even when the OLCC begins talking tough once more; and even when we get some tax reduction by way of federal rescheduling. Because the report concludes:
“The Oregon leisure marijuana market . . . is frequently deprived by {the marketplace} being restricted to Oregon. Yr after yr, provide has outpaced demand.
Till the federal authorities creates pathways to interstate commerce, the Oregon leisure marijuana market might be characterised by variations on the identical theme: a aggressive market that options low costs for shoppers however low margins for companies. As we enter 2025, it stays to be seen how slim the margins might be and the way nicely the Oregon hashish business can function inside them.”
I might add to this the truth that with record-high output and record-low pricing, Oregon growers might be incentivized to promote hashish out the again door or depart the OLCC program altogether. Choices there embrace the intoxicating hemp market or just assuming the dangers of rising unlicensed weed and promoting interstate.
The underside line is it’s tough to make any cash rising hashish in Oregon if you don’t personal the land. And it’s a disgrace now we have an excessive amount of weed in Oregon, for Oregon, however not for different states.
