Arkansas medical marijuana sales set record in 2023

by Talk Business & Politics staff ([email protected]) 490 views 

Arkansas medical marijuana sales set a new record in 2023 with a 2.53% increase over 2022, and the number of Arkansans with active marijuana patient cards rose 8.4% in 2023, according to the Arkansas Department of Finance and Administration (DFA).

The DFA report posted Tuesday (Jan. 9) shows that medical marijuana sales totaled $283 million for the year, up from the previous record of $276 million in 2022. The state’s 38 dispensaries sold 62,227 pounds of marijuana in 2023, well above the 50,547 pounds in 2022. The state has licensed eight cultivators to provide products to the dispensaries.

The Arkansas Department of Health reports 97,374 active patient cards as of Jan. 9, up 8.4% from 89,855 at the end of 2022.

“In late 2023, Arkansas’ medical marijuana industry surpassed $1 billion in total sales since the first dispensary opened for business,” DFA spokesperson Scott Hardin noted in a statement. “From $31 million in sales in 2019 to $283 million in 2023, the industry has grown each year. The $25.6 million spent in December was the largest monthly amount in 2023.”

Following are the top five dispensaries in terms of pounds sold in 2023.
• Suite 443 (Hot Springs): 6,729 pounds
• Natural Relief Dispensary (Sherwood): 5,647 pounds
• CROP (Jonesboro): 3,512 pounds
• High Bank (Pine Bluff): 3,055 pounds
• Releaf Center (Bentonville): 2,990 pounds

More than $120 million in tax revenue has been generated since sales began in 2019. Revenue from medical marijuana sales reached $31 million in 2023, below the $32 million in 2022. Tax revenue doesn’t always mirror sales numbers, Hardin noted.

“The tax revenue doesn’t match well to sales. For example, there may have been large payments made by permit holders in 2022 due to audits from previous years. Those payments would then be included in the month in which it was paid in 2022. Additionally, there is a delay in which we receive the revenue. December was the largest month for sales in 2023. However, collection of that tax revenue will be listed in January 2024 figures,” Hardin told Talk Business & Politics.

Taxes collected are 6.5% of regular state sales tax with each purchase by a patient and a 4% privilege tax on sales from cultivators to dispensaries. Most of the tax revenue is placed in the University of Arkansas for Medical Sciences National Cancer Designation Trust Fund. The state also collects a cultivator privilege tax, which means tax revenue is not always tied to how much product is bought by consumers at dispensaries and the price for the product sold to dispensary customers.

The constitutional amendment legalizing medical marijuana for 17 qualifying conditions and creating a state medical marijuana commission was approved by Arkansas voters 53% (585,030) to 47% (516,525) in November 2016.

NATIONAL TRENDS
According to MJBiz, U.S. medical marijuana sales are projected to reach $11.1 billion in 2023, with all 2023 legal marijuana sales nationwide estimated to total $33.6 billion.

Washington, D.C.-based New Frontier Data, an analytics and data firm focused on the cannabis industry, reported in March 2023 a growing number of U.S. consumers of all forms of legalized marijuana. Following are a few key findings from that report.

• If the pace of state-level legalization continues in the absence of federal policy reform, legal cannabis sales are projected to reach $71 billion by 2030. If that pace stagnates, it would still reach $58 billion.

• An estimated 54 million U.S. adults will consume cannabis in 2023 across both legal and unregulated markets; that will grow to 69 million U.S. consumers by 2030.

• The total number of registered U.S. medical cannabis patients surpassed 4.5 million in 2022; there will be 5.2 million registered by 2030 – with no assumptions for new markets.

• The average U.S. consumer price per ounce of flower has declined 10% since 2010, dropping from $325.46 to $294.15.