The Nevada Department of Taxation (NDOT) recently released sales and tax data from the state’s legal cannabis market for November 2018. Total retail revenues rose to set a record for the second straight month, while those in the adult-use market topped the previous all-time high set in May 2018. However, collections from the state’s wholesale excise levy declined in November, while wholesale pricing was stable despite record-setting demand, indicating sufficient available supply in the state’s licensed system.
According to NDOT data, Nevada cannabis retailers generated over $52.5 million in revenue in November, exceeding the previous record of over $51.6 million in sales established in the previous month. Those figures include both retail sales of adult-use and medical cannabis, with November’s up by 1.7% compared to October’s cumulative revenues. October 2018’s total taxable sales in Nevada are up by 25.2% year-over-year, compared to over $41.9 million in cumulative revenue recorded in November 2017.
Of November’s sales total, over $45 million was generated by adult-use cannabis sales, or 85.7% of overall monthly revenues. In October, over $41.7 million in sales made up 80.8% of total revenue. November’s retail revenues from the adult-use market represent an all-time high for Nevada’s licensed system, topping the previous monthly record of $43.7 million, established in May 2018. Prior to November, sales in the adult-use sector in Nevada had averaged roughly $41.6 million from July through October 2018.
Adult-use sales in Nevada in November were up by 7.9% month-over-month. Sales of cannabis to medical patients, as well as any revenues from other goods, decreased by almost 25% from October to November, from in excess of $9.9 million to about $7.5 million, respectively. Retail sales in the medical sector previously jumped by 25% from September to October, after experiencing a 22% month-over-month decline in September.
November is the seventh consecutive month in which sales in Nevada’s adult-use cannabis sector have topped $40 million. It is the second consecutive month in which total retail revenues have exceeded $50 million. Based on steady sales figures in the summer and early fall months, it appeared at the time that demand in the Silver State may have been stagnating somewhat. However, November’s revenue numbers show that October’s over $50 million in total sales was not a fluke.
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 November declined to over $3.83 million, down by 5.9% from October’s collections of over $4.07 million. Wholesale tax collections from that month represented a record high for Nevada’s market. November’s receipts from the state’s wholesale excise tax are comparable to those reported for July and August 2018, which reached about $3.8 and $3.85 million, respectively.
A decline in wholesale tax collections indicates that sales and transfers by cultivators generally decreased in November. A downturn in wholesale trading in the face of two consecutive months of record retail demand suggests two possibilities: Either retailers have ample inventory in stock already or overall supply in the state is somewhat tight.