Cannabis Sales to Medical Patients in Nevada Drop over 50% From May to June 2019
The Nevada Department of Taxation (NDOT) recently released sales and tax data from the state’s legal cannabis market for June 2019. Total retail revenues slid in June compared to May’s revised, record-setting monthly sales, but revenue generated in the adult-use sector of the market increased. June’s monthly average Spot price was elevated compared to May’s, despite weekly rates being on the downswing. Meanwhile, tax collection data for Q2 suggests that wholesale trading and transfer volume stabilized and was more regular than in previous periods.
According to NDOT data, Nevada cannabis retailers generated over $57.9 million in revenue in June, down from over $62 million in sales in May. Those figures include both retail sales of adult-use and medical cannabis, with June’s down by 6.6% compared to May’s cumulative revenues. June 2019’s total taxable sales in Nevada are up by 19.7% year-over-year, compared to over $48.3 million in cumulative revenue recorded in the same month in 2018.
Of June 2019’s sales total, over $52.8 million was constituted by adult-use cannabis sales, or 91.2% of overall monthly revenues. In May, $50.7 million in adult-use sales made up 81.8% of total revenue. June’s retail revenues from the adult-use market are up by 4.2% month-over-month.
Sales of cannabis to medical patients, as well as any revenues from other goods, decreased by roughly 55% from May to June, from over $11.2 million to under $5.1 million, respectively.
The decline in total retail revenues from May to June observed this year breaks from the behavior documented in the same period in 2018. While last year saw total monthly sales tick upward a bit from May to June 2018, revenue generated by adult-use retailers declined month-over-month, the opposite of what occurred this year.
On the production side, Nevada’s 15% wholesale excise tax applies to transfers of product in both the adult-use and medical sectors of the state’s legal cannabis industry. Receipts from the state’s supply-side excise tax in June increased to over $3.83 million, up by 3.2% from over $3.72 million collected in May. The increase in collections from the state’s wholesale excise levy indicates that the volume of product traded and transferred by cultivators to retailers and processors expanded in June.
Monthly receipts from Nevada’s excise tax on wholesale transfers and trades were relatively steady in Q2, ranging between a low of $3.72 million in May and a high of over $3.89 million in April. Contrastingly, collections from this levy were much more variable in the first quarter of this year, when almost $500,000 separated the low and high amounts reported in that span. More regular receipts from the state’s wholesale excise tax could indicate that supply chain management is improving, with wholesale trading and transfers taking place in a more predictable fashion.