Oregon’s cannabis industry may have recovered from the 2018 oversupply of product, but the entrance of large corporations to the sector and a sophisticated black market create headwinds.
In 2018 Oregon’s cannabis industry looked to be on the verge of a reality check.
Many marijuana businesses reported layoffs, including Chalice Farms, one of the largest Portland dispensaries, which cut its workforce by one-fifth.
It is no secret why times were tough for cannabis growers and retailers in 2018. During that year, the price of cannabis fell to the lowest levels since the state legalized recreational marijuana five years ago.
The price plummet came after a report by the Oregon Liquor Control Commission (OLCC), the state agency that regulates recreational marijuana.
The study claimed growers had produced enough product to satisfy demand for six years.
It’s only been one year since the report, but now the glut appears to be gone. Some retailers report shortages.
“In the past few months, it has been difficult to source flower,” says Anne Marie McClintock, retail purchasing manager at Golden Leaf Holdings, a Canadian company that owns several cannabis brands. “We are also anticipating less outdoor product being available as many growers have left and are now producing industrial hemp.”
The numbers support her conclusion. Today 62,000 acres of hemp are grown in Oregon, a 427% increase from one year ago.
Hemp is a cannabis plant like any other; the distinction is the tetrahydrocannabinol (THC) content, the psychoactive ingredient in the plant, which is lower in industrial hemp than in recreational marijuana.
Hemp was made federally legal in the 2018 Farm Bill. It is used to make oils and lotions, most notably cannabidiol (CBD) oil.
Facing a grim outlook due to the 2018 glut, it appears many growers made the