New York’s Office of Cannabis Management is anticipating that the state market could surpass $5 billion annually once the market matures. Toward that end, the state Cannabis Control Board continued its months-long streak of approving adult-use cannabis licenses, with some bullish expectations about the future of the state’s market.
“We already know that consumers in New York are currently spending roughly $5 billion on unregulated cannabis as it is,” said OCM Policy Director John Kagia during the Aug. 6 meeting of the Cannabis Control Board. “We do think that once the market is fully optimized it will be capturing at least that level of demand.”
For comparison, California reported nearly $5 billion in cannabis sales in 2023.
Kagia also speculated that with the proper testing and retail experience of bud tenders, he expects total annual sales to be even higher, since consumers will be willing to pay a premium to leave the illicit market once there are enough operating legal dispensaries.
At the meeting the CCB, approved 86 licenses, including 22 retailers, 19 cultivators, 18 processors, 11 distributors and 16 microbusinesses, of which only five include retail.
The CCB has approved a total 841 adult-use licenses in 2024, which were reviewed and recommended by the OCM.
Our market continues to exhibit strong growth. Retail sales in June alone were up to $71 million,” said CCB Chair Tremaine Wright. “We’ve reached a significant milestone with 156 licensed dispensaries now open across the state. This provides greater access to legal and safe cannabis to all New Yorkers.”
OCM accepted cannabis license applications in November and December. Of those, the state had already begun reviewing 1,407 of those collected in November, according to OCM Chief Operating Officer Patrick McKeage.
“The office is reviewing applications in the order of the queue, and we’re making our way through that entire queue,” he said. “There’s roughly 600 applications in the November queue that need to have their review started. We should be able to get through those 600 applications by November or by the end of the year.”
McKeage also explained that licenses awarded from the December queue would be limited by what the market needs.
“The number of licenses to be issued will be subjected to supply and demand and market factors,” he said. “As more licenses continue to open and more people receive licenses, we’ll be closer to finding that happy medium in terms of how many licenses the New York State market needs to have in order to be successful and not be oversaturated or undersaturated.”
While ramping up on licensing, the state has also been increasing its enforcement efforts against illicit shops. OCM’s enforcement wing has inspected 508 businesses alleged to be improperly selling cannabis, with 231 shops padlocked, 388 notices of violation issued and 63 hearings scheduled, according to Kagia.
As a result of these enforcement efforts, legal cannabis owners, especially those who have been open more than 12 weeks, have reported a 50% increase in sales since June, explained Kagia. Legal dispensaries in operation within New York City have reported a 99% increase.
“As the illicit shops have been shut down we want to make sure we can keep meeting this demand,” said Kagia.
