The Colorado Department of Revenue (CDOR) recently released its monthly Marijuana Sales Report for July. After sales growth slowed somewhat in June, July saw a big jump in both adult-use and medical revenues, which pushed total sales to a new record high, surpassing the $200 million – as well as the $225 million – mark for the first time. Tax data indicates that the unprecedented demand has resulted in increased wholesale trading and transfer activity, with Colorado’s Spot Index responding by continuing the climb that commenced in June.
In July, combined retail sales of adult-use and medical cannabis totaled over $226.3 million, up by 13.8% compared to June’s combined revenues of over $198.8 million. Historical trends show that sales typically rise from June to July. Still, July 2020’s month-over-month uptick is notable as it represents the third straight month of record-high sales. The magnitude of increase from June to July this year also outpaced that documented last year, which was about 9%.
July 2020’s cumulative sales total represents an increase of 36.1% year-over-year. Prior to May, annual growth rates in monthly sales had been contracting this year, with April 2020 seeing a roughly 9% uptick compared to the same month the year prior. Through the first seven months of 2020, Colorado medical and adult-use retailers have racked up combined sales totaling over $1.2 billion, up by 22.4% compared to over $984 million in total year-to-date sales through the same period last year. For context, in 2019 as a whole, total sales in Colorado grew by over 13% year-over-year.
Adult-use retailers in Colorado tallied over $183.1 million in July, a new record high. Revenues from the state’s adult-use sector in July were up by 15.8% compared to the over $158.1 million in retail sales generated in June. July 2020’s adult-use sales are up 36.9% from those documented for the same month in 2019. Year-to-date sales in the adult-use portion of the market have reached over $954.2 million seven months into 2020, outpacing by 21% the over $788.7 million in recreational revenue through the first seven months of 2019. In 2019, annual revenue generated by recreational retailers grew by 16.2% compared to the year prior.
Medical cannabis revenues in July came to over $43.2 million, up by 6.1% from the over $40.7 million in sales tallied in June in that section of the market. July’s medical cannabis sales represent a new record for the medical market after a downturn in June. Retail sales in Colorado’s medical market in July 2020 are up by 42.4% year-over-year, relative to over $30.3 million in July 2019.
In the wholesale realm, tax collection data for August 2020 – which corresponds generally to wholesale transfers and transactions executed in July – shows that the 15% excise tax on wholesale activity in Colorado’s adult-use system resulted in over $10.47 million accruing to state coffers. August’s wholesale excise tax receipts are up by 11.6% compared to tax collections from the previous month, which amounted to over $9.38 million. They also represent a new record for receipts from this levy for the fifth straight month.
Average Market Rates (AMRs) used by the state to assess the wholesale excise tax on internal transfers of flower, trim, and other plant material between commonly-owned adult-use licenses received their quarterly adjustment at the start of July. (Since August 2017, AMRs are adjusted quarterly by the Colorado Department of Revenue.) Overall, AMRs for the various product types transferred by adult-use cultivators declined for Q3 of this year. Consequently, increased tax collections indicates that wholesale trading and transfers by adult-use growers swelled in July on the record-setting demand that retailers have been facing.
Similar to June, Colorado’s Spot Index rose in each week of July, but at a notably faster pace. The state’s composite rate concluded July up by 9.8% from the start of the month. For July as a whole, the state’s composite price is up by 16.8% from June’s monthly mean.