Here’s what they are saying about pricing and oversupply in the Oregon market
The Oregon Liquor & Cannabis Commission (OLCC) recently released sales data for November. According to OLCC, licensed retailers generated over $86.4 million in revenue last month, down by 7.9% from over $93.8 million in October 2021. November sales are down 4% year-over-year, from nearly $90 million in November 2020.
November is the fourth month in a row of lower monthly cannabis sales figures in Oregon and lower monthly average spot and outdoor prices are a factor. The average Oregon spot price in November 2020 was $1,391 per pound versus $1,105 in November 2021, a difference of $285 per pound year-on-year. November’s price for outdoor flower has dropped over 43% year-on-year.
Average monthly sales per retailer are down for the fourth month in a row as well, falling 8.3% in November 2021 and falling 11.3% year-on-year, which is likely a consequence of lower prices and lessening demand as employment rises. The Oregon unemployment rate has fallen from 7% in October 2020 to 4.4% as of October 2021.
November adult use purchases were $79.9 million, down 7.8% month-on-month and down 2.6% year-on-year. Adult use retail sales were 92% of total sales. Medical sales, at $6.4 million, were down 10% month-on-month and down 19% year-on-year. Medical sales were 8% of November 2021 total sales.
Month-on-month changes in retail sales revenue for the OLCC’s product categories are as follows: Usable marijuana (flower, trim and pre-rolls) was down 10.7% month-on-month and down 10.9% year-on-year, with November sales at $44.6 million. Usable marijuana made up 51.6% of total sales in November 2021.
Concentrates and extracts sales fell 6.6% month-on-month to $21.5 million, and were down 10% year-on-year. Concentrates and extracts were 24.9% of total sales in November 2021 versus 24.5% of total sales in October 2021.
Sales revenue from edibles and tinctures, at $10.6 million, was down 3.1% month-on-month, but were up 12.9% year-on-year. Edibles and tinctures accounted for 12.3% of November’s total sales revenue, versus 11.7% of total sales in October 2021 and 10.5% of total sales in November 2020.
The OLCC reports monthly harvest figures fell from October’s 5.54 million pounds of wet weight to 820,175 pounds as the harvest wrapped up in November, an 85% decrease month-on-month. Year-on-year, November 2021 wet weight is up nearly 9% from 752,609 pounds in November 2020.
The Oregon oversupply situation has been exacerbated by a 54.6% increase in outdoor-grown product in 2021. To date in 2021, outdoor growers have produced 6.4 million pounds of wet weight product versus all of 2020, when 4.1 million pounds of outdoor wet weight was harvested. At this rate of production there is no successful exit door for the Oregon market except for the one marked federal legalization.
Indoor production figures show a 20.6% increase year-on-year. Mixed-light production – greenhouse and light deprivation – show a rather restrained increase of 4.5% from 2020 to 2021.
Oregon’s Spot Index average in November was down 3.9% month-on-month and down 20.6% year-on-year, reflecting increased harvest (supply) year-on-year and plateauing demand in one of the more established state markets.
Read more at https://www.cannabisbenchmarks.com/oregon-oversupply-price-decline/?utm_source=Weekly+Report+Subscribers&utm_campaign=2e0025d47c-EMAIL_CAMPAIGN_2020_04_22_08_10_COPY_01&utm_medium=email&utm_term=0_fc4ce88a6f-2e0025d47c-185147589