Oklahoma’s booming medical cannabis sales continued in June, but it seems that the meteoric growth observed this spring is slowing. Based on tax collection information from the Oklahoma Medical Marijuana Authority (OMMA), June’s medical cannabis sales in the state reached nearly $80 million, another new record for the young market.
Similar to May, it is likely that retail medical cannabis sales in Oklahoma in June outpaced adult-use sales in all but the big four Western markets. Arizona medical cannabis sales revenue may be more than that racked up in Oklahoma, but officials in the former state report only sales volumes. In Illinois, the combined adult-use and medical sales in June amounted to a little less than Oklahoma’s revenue tally.
Medical Marijuana Patient Counts Continue to Rise
June sales in Oklahoma are up by 8% compared to over $73.8 million in May. In April and May of this year, however, sales grew by 25% and 20%, respectively. Given the slowing growth rate, it is possible that sales in the state are approaching a peak. However, a significant number of new patients registered for Oklahoma’s medical cannabis program in June, injecting new demand into the market. According to the OMMA, 313,638 patients were licensed by the end of June, up by about 5% from 297,000 a month earlier.
Continued Surge of New Business Licenses Results in Increased Competition
While new demand is entering the market, the number of new businesses licensed to meet it is also on the rise. 2,113 dispensaries were actively licensed as of July 1, up from 2,035 the month before. The number of actively licensed growers increased in the same span, from about 5,800 to 5,970. The number of licensed businesses in Oklahoma is much higher than in even mature adult-use cannabis markets. This stiff competition that has contributed to keeping wholesale flower prices in Oklahoma lower than in most other longer-standing medical cannabis systems. Oklahoma’s Spot Index averaged $1,877 per pound in June, down 2% from $1,915 per pound in May.
Will New Testing Lab Licensing Requirements Impact Wholesale Prices?
We began assessing wholesale flower prices in Oklahoma’s medical cannabis market earlier this year. Despite being a relatively young medical cannabis program, wholesale rates in Oklahoma are significantly lower than many longer-standing medical systems due to low barriers to entry that have allowed licensed businesses to proliferate to levels much higher than in even mature adult-use markets. However, cultivators in the state may be seeing some higher costs moving forward.
According to a report from local outlet KOCO, cannabis testing labs must now be licensed by the Oklahoma Medical Marijuana Authority (OMMA). The report notes that testing has been required, but previously labs did not have to be licensed by state regulators. With labs now mandated to be licensed, their costs will likely rise, which will presumably be passed on in the form of higher testing prices for cultivators and product manufacturers.