Oregon cannabis growers have enough marijuana to meet the demands of users for more than six years, and the oversupply has prompted Gov. Kate Brown to propose curbing the number of pot-growing licenses issued.
In a report to the Oregon Legislature, the Oregon Liquor Control Commission said the cannabis industry produces twice as much as the state consumes, according to a Portland Business Journal article. It said recreational retailers account for 55 percent of adult demand while the rest are supplied by homegrown, medical or illegal marijuana.
Legalization of cannabis in Oregon has brought in $200 million in state and local tax revenue and provides a safer product than the illegal market, but the excess product has driven prices so low that many businesses are hurting. Law enforcement officers and politicians worry they’ll seek to sell their product in other states where prices are higher. But in most other states, cannabis remains a federally controlled substance.
The state put a moratorium on new license applications in the summer of 2018, but not because of a glut in the market. Rather, the agency wanted to let its staff catch up on the paperwork. At the beginning of 2018, the state had 900 licensed growers; today, that number has grown to 1,236.
OLCC chief Steve Marks described the overflow of projects as a sign that the legalization of cannabis is working.
Craft Cannabis Alliance is lobbying for a long-term solution, a bill that would let Oregon create cannabis transfer agreements with other states and open up new markets, but that would require easing of federal prohibitions.
Another solution is to let the market dictate supply and demand.