Adult-use states continue to grow (GRAMF)
Most adult-use states saw a sequential increase in cannabis sales in January, as seen in the following chart. Sales in California grew 43.5% YOY in January but declined 0.1% from December. The Parent Company (GRAMF) is the largest vertically integrated cannabis operator in California. In most states, January is seasonally smaller than December. However, in January 2021, sales increased sequentially in Colorado, Washington, Michigan, Oregon, Nevada, and Massachusetts.
CANNABIS CAPITAL
Cannabis companies have raised roughly $2 billion this year as of Feb. 12, a 60% increase from the comparable period in 2020. Institutional investors are slowly making their way into space. Fidelity, Putnam, and Wasatch Global have recently invested in major cannabis companies like Curaleaf, Green Thumb Industries, and Cresco Labs.
LEGALIZATION 'TOO MANY COOKS’
The path to legalizations is complicated and gets even harder if there are too many cooks in the kitchen and there are no apparent priorities for what comes first. Legalization will happen in waves, and it will not come all at once—Thirty-seven House Democrats (including House Judiciary Committee Chair Jerry Nadler (N.Y.), and progressive Reps. Ayanna Pressley (Mass.) and Alexandria Ocasio-Cortez (N.Y.) sent a letter to President Biden on Thursday to use his clemency powers to issue a blanket pardon for all nonviolent federal cannabis offenses. The letter was led by Congressional Cannabis Caucus Co-Chairs Barbara Lee (Calif.) and Earl Blumenauer (Ore.), but not surprisingly absent from the letter was any congressional Republicans. Importantly, notable cannabis supporters and Cannabis Caucus co-chairs Don Young (Alaska), and Dave Joyce (Ohio) did not sign the letter. Also absent were other cannabis supporters Matt Gaetz (Fla.) and Tom McClintock (Calif.).
Getting the social justice aspect of legalization is important, and this letter highlights a growing division between pro-legalization Democrats and Republicans on the specifics of reform – “if people who knowingly break the law — even if they believe the law should be changed — should have their records eliminated?”
Its divisions like this are going to make legalization more challenging in 2021.
