Good morning.
Chris Casacchia, longtime cannabis business journalist, is pitching in this week on the daily newsletter. Please send briefs, press releases, news, tips, data and more to [email protected] as he preps the daily rundown and expands his role at Cultivated.
Let’s get to it.
-CC, JR
Today’s newsletter is 918 words or about a 7-minute read.
THIS NEWSLETTER MADE POSSIBLE BY:
💡 What’s the big deal?
ECONOMICS
📊 U.S. cannabis sales projected to hit $30.5B in 2026
Whitney Economics forecasts U.S. cannabis sales in 2026 to increase to $30.5 billion, up 4.9% from 2025.
The modest growth projection, fueled by retail expansion in New York and New Jersey, has been curtailed by widespread price compression in more established states like California, which saw sales dip to $3.9 billion last year, down 7.1% from 2024, despite unit sales increasing.
While industry headwinds persist, including a pull back in consumer discretionary mimicking the broader economy, growth is still a positive development in the choppy sector more defined by individual state markets than national assessments.
“This is a welcome rebound from just a year ago, when the U.S. legal cannabis market experienced its first year-over-year revenue decline in the legal regulated market’s history.” founder and Chief Economist Beau Whitney said in a press release.
“The growth rates are still positive, just not as much as in previous years where we had forecasted 13.4% growth for 2026.”
The Portland, Ore.-based cannabis consulting and data researcher estimated 2025 marijuana sales at $29.1 billion, down from $30.1 billion in 2024, or 3.3%.
Price compression in the U.S. cannabis sector is a rare anomaly in the current economic climate in which inflation, rising oil prices, tariffs and other factors are driving up the cost of goods and services in nearly every other sector.
-CC
LIT ALERTS*
📉 Price compression has officially come for every format in New York
As part of our Empire State Pivot webinar series, the team at Lit Alerts team conducted a six-month analysis of average menu listing prices for the most popular package sizes.
Across the four most popular product categories in New York, vapes took the hardest hit from price compression, the 1g size dropped -6.76%, the steepest decline of any tracked package size. The 0.5g vape wasn't far behind at -5.14%, making vapes the most compressed category overall.
Flower also felt significant strain, particularly at the 7g weight (-7.09%), which was actually the single largest price compression across all formats and sizes. The 14g and 3.5g followed at -5.86% and -4.37% respectively.
Edibles (100mg) and pre-rolls experienced comparatively milder compression: edibles at -4.29% and pre-rolls ranging from just -0.88% (3.5g) to -2.95% (1g) — suggesting that format held pricing power better than the others during this period.
In short, mid-size flower and vape cartridges bore the brunt of NY's price compression, while pre-rolls — especially larger sizes — proved most resilient.
If you missed us on March 19th, watch the video recording, where Jay and Lit Alert’s Rick Bashkoff were joined by New York cannabis leaders Wyatt Harms of FLAMER and Coss Marte of CONBUD for a candid, data-driven conversation about one of the industry’s most pressing challenges: price compression.
*To learn more about Lit Alerts and get a special offer only available to Cultivated readers, visit litalerts.com.
⏩ Quick hits
The city council in Long Beach, Calif. has advanced a proposal to issue special permits for the sale and consumption of cannabis at certain venues, including Queen Mary, convention center, and the Long Beach Amphitheater, a new outdoor waterfront music venue set to open June 6 with a performance by Snoop Dogg and others, the Long Beach Post reported.
The recently concluded Seattle show was Marijuana Ventures’ 32 Interchange Remix, a B2B event that links brands with retailers, a business model akin to Hall of Flowers, which recently hosted their marquee expo in Ventura, Calif.
Mississippi Republican Gov. Tate Reeves, according to Marijuana Moment, vetoed bills that would have expanded product expansion and medical marijuana access to patients with chronic, terminal illnesses, while approving a measure for therapy research on psychedelic ibogaine.
🧳 People moves
The New Jersey Cannabis Regulatory Commission will be seeking a new leader. Dianna Houenou, the first chair of the state’s marijuana regulatory agency appointed in 2020 by then-Gov. Phil Murphy, confirmed to Politico she will step down April 10. “I feel it’s time for a new leader to take the helm and chart out the next steps in the agency’s story,”she told the Beltway media outlet. Her departure is the latest shake-up in the top ranks of state-run cannabis compliance departments.
Clint Kellum, who recently sat down for a Cultivated Q&A and Cultivated Live appearance, was appointed director of California’s Department of Cannabis Control in January. In late February, John Kagia was appointed Acting Executive Director of New York’s Office of Cannabis Management, following interim leader Susan Filburn, who took over after Felicia Reid’s abrupt December resignation.
📺 Tune in
Judson Hill, president of vertically-integrated Fine Fettle, will be joining Cultivated Live today at 10 AM Eastern to discuss Georgia’s evolving medical cannabis framework and regulations, which include proposals to ease access, allow vape products and raise THC caps to 50%, up from 5%, one of the lowest thresholds in the nation. The state’s legislative session ends April 2.
