{"id":825,"date":"2021-08-31T00:06:16","date_gmt":"2021-08-31T00:06:16","guid":{"rendered":"https:\/\/www.leafly.com\/wp-home\/?p=176393"},"modified":"2021-08-31T00:06:16","modified_gmt":"2021-08-31T00:06:16","slug":"california-is-growing-more-legal-cannabis-than-it-can-sell","status":"publish","type":"post","link":"https:\/\/thcinct.com\/?p=825","title":{"rendered":"California is growing more legal cannabis than it can sell"},"content":{"rendered":"<p>  <title>California is growing more legal cannabis than it can sell | Leafly<\/title>     <!-- Quotes = strings--><!-- No quotes = boolean-->\t   <!-- This site is optimized with the Yoast SEO Premium plugin v15.9.2 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->                  <!-- \/ Yoast SEO Premium plugin. --> <\/p>\n<p> <!-- BEGIN Sailthru Horizon Meta Information --><\/p>\n<p><!-- END Sailthru Horizon Meta Information -->  <!-- Google Publisher Tag --> <!-- End Google Publisher Tag --> <!-- Google Tag Manager --> <!-- End Google Tag Manager --> <!-- Chartbeat --> <!-- End Chartbeat --><br \/>\n <!-- Google Tag Manager (noscript) -->   <!-- End Google Tag Manager (noscript) -->   <title>Leafly<\/title>     <title>Leafly \u00ae<\/title>                                                                                                                                                                                                                                                                                                                                                                                              <title>Loading\u2026<\/title>     <\/p>\n<div class=\"bg-white fixed flex hidden inset-0 items-start md:h-auto md:items-center overflow-auto\" id=\"age-gate-container\">\n<div class=\"bg-white md:h-auto mx-auto p-lg text-sm w-full\" id=\"age-gate\">\n<p><label for=\"select-country\">Where are you from?<\/label><\/p>\n<div class=\"age-gate__info\">\n<p><button class=\"button\" data-testid=\"age-gate-no-button\" id=\"tou-cancel\">no<\/button><button class=\"button ml-md\" data-testid=\"age-gate-yes-button\" id=\"tou-continue\">yes<\/button><\/p>\n<p><label class=\"checkbox__label my-xl\"><span class=\"text-xs\" id=\"remember-user-label\">Remember me for 30 days. <br \/>I confirm that this is not a shared device.<\/span><\/label><\/p>\n<p class=\"error error--underage hidden\">Darn! You&#8217;re not old enough to use Leafly.<\/p>\n<\/div>\n<p class=\"hidden age-gate__loading\">Redirecting you to<span class=\"redirect-domain\"><\/span><\/p>\n<p class=\"text-xs mt-auto\">By accessing this site, you accept<br \/>\nthe <a class=\"py-xl\" data-testid=\"tou-link\" href=\"https:\/\/www.leafly.com\/info\/terms-of-use\">Terms of Use<\/a><br \/>\nand <a class=\"py-xl\" data-testid=\"pp-link\" href=\"https:\/\/www.leafly.com\/info\/privacy-policy\">Privacy Policy<\/a>.<\/p>\n<\/div>\n<\/div>\n<div class=\"container my-xl\">\n<div class=\"row\">\n<div class=\"col md:col-9\" id=\"article-content\">\n<p class=\"has-drop-cap\">There\u2019s a lot of affordable, tested cannabis flower to smoke at low prices in California this summer.<\/p>\n<p>What a change from last summer, when a cannabis drought brought on by COVID demand and a seasonal shortage of the legal supply sent prices soaring at dispensaries.<\/p>\n<p>Pot shop owners are selling 2020\u2019s fall outdoor ounces at $200. They\u2019re trying to make room for 2021\u2019s early summer harvest, which is arriving in stores now.<\/p>\n<p>Right now in west Los Angeles:<\/p>\n<ul>\n<li><a href=\"https:\/\/www.leafly.com\/dispensary-info\/the-higher-path\"><span>The Higher Path<\/span><\/a> has an ounce at $140 and half ounces at $55<\/li>\n<li><a href=\"https:\/\/www.leafly.com\/dispensary-info\/the-pottery\"><span>The Pottery<\/span><\/a> has ounces at $132 and $128<\/li>\n<li><a href=\"https:\/\/www.leafly.com\/dispensary-info\/herb\"><span>Herb<\/span><\/a> has half ounces for $50 and ounces for $130<\/li>\n<li><a href=\"https:\/\/www.leafly.com\/dispensary-info\/medmen-venice\"><span>MedMen Venice<\/span><\/a>\u2014which gets pilloried for high prices\u2014has an ounce of White Runtz from Farmer and the Felon at $160, Pacific Stone 805 Glue for $155 per ounce, and Miss Grass half-ounces at $85<\/li>\n<\/ul>\n<p>On budget flower shelves at dispensaries, legalization can now provide the number one value proposition of the black market: low price. That\u2019s on top of convenience, legality, testing, and safety.<\/p>\n<h2 id=\"h-what-changed-supply-and-demand-in-california\">What changed supply and demand in California?<\/h2>\n<p>Cannabis consumer smiles are pot farmer tears, unfortunately.<\/p>\n<p>Prices are tumbling because\u2014three years after legal sales began\u2014California is growing more legal cannabis than ever. Meanwhile, the number of legal stores remains a fraction of what they were in the medical marijuana era.<\/p>\n<p>According to the California <a href=\"https:\/\/aca6.accela.com\/CALCANNABIS\/Cap\/CapHome.aspx?module=Licenses\">Department of Cannabis Control<\/a>, the state has 7,297 active cannabis farm licenses as of Aug. 30, 2021. <\/p>\n<p>By contrast, the state reports 1,130 retail store or delivery licenses. Retail store licensing remains subject to local control in California, and slow growth laws.<\/p>\n<blockquote class=\"wp-block-quote is-style-default\">\n<p>California has nearly seven licensed pot farms for every licensed retail store.<\/p>\n<p><cite>Leafly analysis<\/cite><\/p><\/blockquote>\n<p>The Humboldt County Grower Association\u2019s Ross Gordon told <a href=\"https:\/\/mjbizdaily.com\/falling-prices-in-california-marijuana-wholesale-market-alarms-some-growers\/\" target=\"_blank\" rel=\"noreferrer noopener\">MJBizDaily.com<\/a> Aug. 7 that he estimates the state is growing 1,700 acres of legal cannabis, but stores are only selling an estimated 1,100 acres of product. Another producer Adrian Sedlin at Canndescent told MJBizDaily.com that legal supply is 12 times legal demand now.<\/p>\n<p>After three years of feast and famine in the legal market, distributors are seeing successive floods of flower that started with the 2020 harvest and they don\u2019t promise to recede. <\/p>\n<p>The 2021 early <a href=\"https:\/\/www.leafly.com\/news\/growing\/how-to-maximize-harvest-by-growing-light-deprivation-cannabis\">light deps<\/a> are coming in heavy, <a href=\"https:\/\/www.laweekly.com\/the-light-dep-cannabis-report-mendocino-county\/\" target=\"_blank\" rel=\"noreferrer noopener\">reports state<\/a>. Behind them is the full sun harvest. In the background, huge indoor and mixed light facilities are also pumping out pounds.<\/p>\n<p>Leafly\u2019s sources corroborated reports of farmers struggling to get target prices for their spring season of light dep flower, coming down now. Older buds from the 2020 outdoor harvest sometimes cannot be sold, according to reports.<\/p>\n<p>Major California distributors buy from farms and sell into stores, so they\u2019re uniquely positioned to report on the health of the market. They\u2019re concerned, they told Leafly.<\/p>\n<figure class=\"wp-block-image size-large\"><img width=\"1024\" height=\"640\" alt=\"Raw Garden harvest photo essay by David Downs at Leafly\" class=\"wp-image-155640 has-ll lazyload\" data-srcset=\"https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-1.jpg,compress&amp;w=550 550w, https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-1.jpg,compress&amp;w=740 740w, https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-1.jpg,compress&amp;w=1100 1100w, https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-1.jpg,compress&amp;w=1480 1480w\"><figcaption>Acres of Central Valley cannabis. (Brian Walker \/ Courtesy Raw Garden\/File Photo 2020)<\/figcaption><\/figure>\n<p>\u201cThere is a big glut with more coming,\u201d one distribution licensee told Leafly.<\/p>\n<p>At major distributor\/manufacturer licensee CannaCraft, Chief of Government &amp; Consumer Affairs Tiffany Devitt said the market is \u201cunbalanced\u201d and \u201cunstable\u201d with \u201cdevastating\u201d price fluctuations that swung from drought last summer to flood this summer. And there aren\u2019t enough new stores to soak up the excess product.<\/p>\n<p>\u201cWe went from a market where the system made it so difficult for cultivators to join the legal market that we didn\u2019t have enough supply and prices were extremely high through 2019 and 2020.<\/p>\n<p>\u201cToday, we have a lot more supply but retail growth isn\u2019t there because the majority of jurisdictions have banned retail,\u201d said Devitt. \u201cSo even as the state has made good faith efforts to fix retail licensing, new licensees are just entering the same markets, slicing the market share pie there ever thinner, rather than actually expanding overall markets. More flower going into the same size market is driving prices down and that\u2019s devastating California\u2019s cannabis industry.\u201d<\/p>\n<h2 id=\"h-illicit-industry-may-be-playing-a-shadow-role\">Illicit industry may be playing a shadow role<\/h2>\n<p>A Northern California grower-retailer also said that not only is there a glut in the legal supply of weed, but there\u2019s a flood in the illegal supply of weed that\u2019s backed up into legal channels.<\/p>\n<p>Instead of diversion\u2014where legal weed leaves the tracked system, he\u2019s reporting \u201cinversion\u201d\u2014where cheap, unlicensed grown pot is entering the legal system.<\/p>\n<p>\u201cOregon is producing tons and tons of THC and calling it hemp,\u201d Leafly\u2019s source reports. \u201cOklahoma is too. This depresses illicit market prices. And this forces prices down in the legal market. It does this by illicit products flowing into the legal system inexpensively. Or, by reducing illicit market demand for legal market cannabis, thus creating a glut in the legal market.\u201d<\/p>\n<p> <a href=\"https:\/\/www.leafly.com\/news\/cannabis-101\/what-is-thc-o\" class=\"wp-block-leafly-blocks-leafly-single-inline-block leafly-inline-related-story\"><\/p>\n<div class=\"border border-deep-green-alt border-l-0 border-r-0 my-xl p-md font-bold\">\n<p>Related<\/p>\n<p>Meet THC-O, a hemp-derived compound three times stronger than THC<\/p>\n<\/div>\n<p><\/a> <\/p>\n<p>The licensee reported not only high taxes and regulations driving inversion but low oversight of malefactors. Many cannabis growers and distributors straddle both sides of the market, he said.<\/p>\n<p>\u201cOver-taxation only works if there are regulations that are enforced. It doesn\u2019t look like they\u2019re doing it,\u201d he said.<\/p>\n<h2 id=\"h-cannabis-economics-are-changing-forever\">Cannabis economics are changing forever<\/h2>\n<p>Prohibition grossly distorted the cost of pot, but as it recedes, cannabis economics are changing. <\/p>\n<p>Researchers forecasted a decade ago that legal cannabis could be 90% cheaper than prohibition prices. We\u2019ve seen that validated in Oregon, which saw eighths hit as low as <a href=\"https:\/\/www.leafly.com\/news\/strains-products\/portlands-6-eighth-ounces-are-the-future-of-cannabis\">$6 in 2019<\/a>.<\/p>\n<p>The question has been \u201cWhere, when, and how fast would weed prices drop?\u201d<\/p>\n<p>The illicit market used to be cheaper than the legal market, and East Coast prices used to be higher than the West. Today, there\u2019s 19 legalization states, more than 30 medical states, plus hemp legalization with leakage into the THC markets.<\/p>\n<figure class=\"wp-block-pullquote is-style-solid-color\">\n<blockquote>\n<p>We need to open up more jurisdictions to retail and we need to fix the cultivation tax system.<\/p>\n<p><cite>CannaCraft Chief of Government &amp; Consumer Affairs Director Tiffany Devitt<\/cite><\/p><\/blockquote>\n<\/figure>\n<p>Today, a major California retail owner and market expert told Leafly, \u201cThe legal and illegal market prices have equalized.\u201d<\/p>\n<p>Fixing the legal California market\u2019s oversupply problem will require new stores in new cities, and lowering cultivation taxes to match the shrinking profit margins industry-wide, said Devitt.<\/p>\n<p>\u201cThere\u2019s no quick fix, but to bring more stability to the market and sustain one of the State\u2019s great heritage industries, we need to open up more jurisdictions to retail and we need to fix the cultivation tax system, which is a flat tax based on weight. At $154.40 per pound, the tax rate is currently 20% to 70% or higher, while taxes were 10% to 15% a year ago,\u201d said Devitt.<\/p>\n<h2 id=\"h-what-s-a-farmer-to-do\">What\u2019s a farmer to do?<\/h2>\n<p>As legal cannabis supply increases and prices fall, winners and losers among pot farmers are emerging.<\/p>\n<p>If you\u2019re thinking of growing legal\u2014grow superb, highly potent, flavorful exotic small batch pot. The top end has never been pricier: $75 an eighth-ounce for artisanal Wonderbrett Peach OZ. That\u2019s what Justin Bieber <a href=\"https:\/\/www.leafly.com\/news\/strains-products\/13-top-weed-strains-august-2021\">was buying<\/a> in July in LA.<\/p>\n<figure class=\"wp-block-image size-large\"><img width=\"1024\" height=\"576\" alt=\"Up close purple and orange buds of Peach OZ (Courtesy Wonderbett)\" class=\"wp-image-175425 has-ll lazyload\" data-srcset=\"https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-2.jpg,compress&amp;w=550 550w, https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-2.jpg,compress&amp;w=740 740w, https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-2.jpg,compress&amp;w=1100 1100w, https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell-2.jpg,compress&amp;w=1480 1480w\"><figcaption>Up close purple and orange buds of Peach OZ (Courtesy Wonderbett)<\/figcaption><\/figure>\n<p>But at the bottom end of quality, small farms can\u2019t compete against the flood of medium or low-quality bud. (That\u2019s similar to the traditional farm economy where heirlooms command a premium.)<\/p>\n<p>Another factor is location, with remote outdoor farmers under more pressure to move pounds out the door.<\/p>\n<p>\u201c[Prices] are definitely starting to drop, and it seems the more remote you are the more willing you are to negotiate,\u201d one broker told Leafly.<\/p>\n<p class=\"has-humulene-background-color has-background\"><strong>Price drop:<\/strong> <strong>California cannabis wholesale prices<\/strong> <strong>over time<\/strong><\/p>\n<p><strong>Indoor-grown high-grade flower buds<\/strong><br \/>Pound of <strong>indoor<\/strong> OG Kush at late \u201890s prohibition peaks: ~$5,000 (interviews)<br \/>Pound of <strong>indoor<\/strong> exotics in 2021: ~$2,000 (interviews)<\/p>\n<p><strong>Light dep (aka mixed light) buds<\/strong><br \/>Pound of light dep in 2020: $1,300-$1,600 (MJBizDaily.com)<br \/>Pound of light dep in 2021: $600-$800 (MJBizDaily.com)<\/p>\n<p><strong>Outdoor (aka full sun) buds<\/strong><br \/>Pound of 2020 outdoor in 2020: $800-$1,000 (MJBizDaily.com)<br \/>Pound of 2020 outdoor in 2021: $200-$500 (MJBizDaily.com)<\/p>\n<div id=\"author-box\" class=\"p-lg my-xxl bg-white rounded border border-light-grey elevation-low\">\n<div class=\"mb-lg\"> <img decoding=\"async\" src=\"https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell.jpg\" alt=\"David Downs's Bio Image\" class=\"lazyload inline-block mr-md rounded-full border border-light-grey\"> <\/p>\n<p>David Downs<\/p>\n<\/p><\/div>\n<p class=\"text-sm\">David Downs directs news and lifestyle coverage as the California Bureau Chief for Leafly.com. He&#8217;s written for WIRED, Rolling Stone and Billboard, and is the former cannabis editor of the San Francisco Chronicle, as well as the author of several cannabis books including &#8216;Marijuana Harvest&#8217; by Ed Rosenthal and David Downs. He co-hosts The Hash podcast. TW: @davidrdowns | IG @daviddowns<\/p>\n<p> <a class=\"text-sm font-bold underline text-green\" href=\"https:\/\/www.leafly.com\/news\/author\/david-downs\">View David Downs&#8217;s articles<\/a> <\/div>\n<div class=\"leafly-sailthru-signup p-lg my-xl bg-white rounded elevation-low border border-light-grey\">\n<p class=\"text-xs pt-lg\">By submitting this form, you will be subscribed to news and promotional emails from <a href=\"https:\/\/www.leafly.com\">Leafly<\/a> and you agree to Leafly&#8217;s <a href=\"https:\/\/www.leafly.com\/company\/tos\">Terms of Service<\/a> and <a href=\"https:\/\/www.leafly.com\/company\/privacy-policy\">Privacy Policy<\/a>. You can unsubscribe from Leafly email messages anytime.<\/p>\n<\/div><\/div>\n<\/p><\/div>\n<\/div>\n<p> <!-- Chartbeat --> <!-- End Chartbeat -->  <!--\nPerformance optimized by W3 Total Cache. Learn more: https:\/\/www.boldgrid.com\/w3-total-cache\/ Served from: _ @ 2021-08-31 09:11:21 by W3 Total Cache\n--><\/p>\n","protected":false},"excerpt":{"rendered":"<p>California is growing more legal cannabis than it can sell | Leafly Leafly Leafly \u00ae Loading\u2026 Where are you from? noyes Remember me for 30 days. I confirm that this is not a shared device. Darn! You&#8217;re not old enough to use Leafly. Redirecting you to By accessing this site, you accept the Terms of Use and Privacy Policy. There\u2019s a lot of affordable, tested cannabis flower to smoke at low prices in California this summer. What a change from last summer, when a cannabis drought brought on by COVID demand and a seasonal shortage of the legal supply sent&#8230; <\/p>\n","protected":false},"author":1,"featured_media":826,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[],"class_list":["post-825","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-marijuana_information"],"jetpack_featured_media_url":"https:\/\/thcinct.com\/wp-content\/uploads\/2021\/08\/california-is-growing-more-legal-cannabis-than-it-can-sell.jpg","_links":{"self":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts\/825","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=825"}],"version-history":[{"count":0,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/posts\/825\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=\/wp\/v2\/media\/826"}],"wp:attachment":[{"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=825"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=825"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thcinct.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=825"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}