Marijuana Industry on Pace for Another Annual Dip in 2023

After a rough April and what was dubbed as "worst 4/20 in five years," Colorado dispensaries performed even worse in May. Maria Levitov

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Colorado dispensaries will collect less money in 2023 than they did last year, according to sales projections based on state Department of Revenue data.

Through the first five months of 2023, Colorado saw just over $651 million in marijuana sales, DOR numbers show. That puts dispensary sales on pace to total about $1.56 billion this year, which would be a 12 percent dip from the $1.77 billion in sales in 2022 — and over 32 percent less than the record $2.23 billion in sales in 2021.

After a rough April and what was dubbed the "worst 4/20 in five years" by the Marijuana Industry Group, Colorado dispensaries had an even more disappointing performance in May, according to monthly sales reports from the DOR. Medical marijuana sales registered under $32 million over those two months, a record low, while recreational sales continued to fall, accounting for just over $111 million in May.

The poor sales numbers coincide with plummeting prices over the past two years, according to DOR market rates. After record-breaking performances during the COVID-19 pandemic in 2020 and 2021, Colorado's marijuana industry experienced a surge in growers and a surplus of product. The oversupply and increased competition from states new to legal marijuana have put commercial pot sales in a downward spiral across the country, particularly in Colorado.

Since 2021, the median price per pound of marijuana flower has fallen 60 percent. Over that same period, the number of marijuana business licenses dropped from more than 3,500 to around 2,700 as of last month, Colorado Marijuana Enforcement Division numbers show. The price cuts and license losses have led to job cuts, as well. From 2022 to 2023, Colorado's marijuana workforce had dropped by almost 30 percent, according to a market report from marijuana industry recruiting firm Vangst.

The prices of both wholesale and dispensary flower have been slowly inching back up over the summer, DOR reports show. However, the price of marijuana plant matter intended for extraction has plummeted by more than 183 percent since April, from $405 to $143 per pound, indicating a looming drop in the price of certain products made from hydrocarbon extraction.

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Colorado Department of Revenue