Nevada is the latest jurisdiction to experience a boost in legal cannabis sales thanks to COVID-19 panic buying, while the Massachusetts Cannabis Control Commission issued a state-wide shutdown order to dispensaries.
The coronavirus epidemic is sending shockwaves through the economy and the US cannabis industry is the latest to be affected, as the Massachusetts government shut down cannabis dispensaries across the state.
However, the situation was a different story in Nevada, where coronavirus panic buying prompted a surge in cannabis sales.
The spike in sales that we saw [in Nevada] is similar to what we see for a holiday like 420. That's the biggest holiday of the year [for dispensaries]. I think the big concern for everyone in the cannabis industry is that this a short term blip and then we will see a deterioration of the market. While there's a pick up in sales, it'll be interesting to see if the demand slacks off. If the country is told you can only go to the grocery store, you're going to see less traffic [at dispensaries].BDS Analytics CEO, Roy Bingham
Consumers worried about access to cannabis during the lockdown have flooded to Nevada marijuana retailers over the last week—and according to industry data they're buying in bulk—which has caused a 20% increase in product purchased per transaction across the US.
Research has also shown that consumers are buying more raw cannabis flower—rather than stocking up on edibles—which may indicate reflect the need for medicinal marijuana patients to stock up before harsher lockdown measures come into place.
Marijuana dispensaries such as Sol Cannabis have even seen a 25% sales jump take place in the space of a few days, despite quarantine regulations forbidding lines of customers, curbside delivery and even active waiting rooms.
"It's difficult because we are a more 'affectionate' dispensary," Sol Cannabis owner Ed Alexander said.
And according to a researcher and industry expert for GreenWave Advisors, Matt Karnes, this trend is likely to continue for some time, as consumers are stockpiling cannabis out of fear that the supply will run during the quarantine period.
"The supply chain continues to show signs of vulnerability and for the cannabis consumer mindful of potential inventory shortages, this could trigger the decision to purchase more product upfront," Karnes said.
Unfortunately, this luxury is no longer available for residents of Massachusetts, after the state's Cannabis Control Commission (CCC) issued a shutdown order to dispensaries late last week.
However, the order also temporarily authorized medical dispensaries to continue operating—as long as they limit their activities to curbside pickup for patients and caregivers—after they were deemed an "essential business" by Massachusetts's governor Charlie Baker.
"Safe patient access during Massachusetts' state of emergency requires regulatory responsiveness and intentional protocols aimed at reducing exposure to Coronavirus," CCC Executive Director Shawn Collins said.
"I am proud the Commission has deployed several system and policy enhancements to the Medical Use of Marijuana Program that both improve the patient experience and maintain compliant operations in the face of unanticipated disruptions to our way of life."
This could be one of the best investing opportunities of 2020
Legislative changes are blowing through the US, and with it, an ever-increasing number of states legalising cannabis for recreational use.
With the success seen in Illinois, which legalised for adult-use on January 1 and saw products moving off the shelf at an unprecedented rate, this company is primed to take advantage of the booming US recreational market.
They have secured partnerships with the biggest cannabis companies in the US, and their portfolio is second to none.
And with the sector-wide pullback of 2019, this company is now at a bargain-basement price.
& Keep Up to Date
Get the latest pot stock recommendations, cannabis news
and industry updates straight to your inbox!