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Bad for Buyers & Sellers: Nevada is the Middleman’s Marijuana Market

Cannabis Distribution Nevada Cannabis Now Magazine


Bad for Buyers & Sellers: Nevada is the Middleman’s Marijuana Market

Nevada is experiencing major distribution problems when it comes to cannabis.

Unless a trip to the Grand Canyon or a prizefight where the outcome is actually in doubt comes packaged with your marijuana vacation, please do yourself a favor, and stay far, far away from Las Vegas. Or maybe you appreciate the town’s grand tradition of hucksters and suckers, and want to participate. Just be forewarned: Your role will be that of the taken.

Ongoing and entirely predictable supply woes have swollen retail prices of recreational marijuana products by as much as 300 percent. Prices remain high even as sales figures plummet — because, you see, it’s not through lack of demand. Nevada’s licensed marijuana distributor is working overtime to keep the industry going. Reno-based Blackbird is making as many as 150 deliveries a day to dispensaries across the state, who are in turn running out of product, and spending days watching dust collect on empty shelves before a resupply can come through.

You read that right: distributor, singular.

Nevada is the first of the four states to legalize marijuana for adults over 21 last November to record a commercial transaction, but rather than a model for quick and efficient stewardship to follow, Nevada is becoming a cautionary tale. Written into the state’s legalization law are restrictions on who can distribute the product. For now, only alcohol companies can provide the essential middle link between product producer and product seller — and at the moment, there’s only one company providing this key service.

The ensuing disruption hasn’t really helped anyone. Cultivators might be happy, considering the price of a pound of trim has tripled, according to Forbes. Retailers should be happy, seeing as how they can’t keep edibles, pre-rolls, and low-THC products in stock. But it’s not so. Somehow, nobody is happy.

“Cultivators and producers have product sitting for days waiting to be delivered to stores while the quality of the product degrades. Retailers do not have the products their customers desire, products that are legal and should be available to them,” wrote Deonne Contine, director of the Nevada Department of Taxation, in a recent report lamenting the status quo, according to the Reno Gazette-Journal.

According to state regulators, despite steady demand, thanks to dwindling supply, recreational marijuana sales have dropped since adult-use dispensaries opened for business for everyone and anyone 21 and over early last month. By volume, dispensaries’ ledgers are down by as much as 30 percent in August.

On the consumer end, cannabis prices haven’t quite yet reached Washington in 2014 levels, when supply was so limited that Seattle dispensaries got away with selling $20 grams. For now, at least, prices are at prices California consumers would recognize. Browsing menus on Weedmaps, eighths appear to be demanding the predictable $45 to $60 range.

At the same time, cannabis flower aren’t what Las Vegas dispensary customers want. Most of them are tourists, and since they can’t smoke in their hotels and aren’t supposed to smoke on the street, they’re largely buying edibles, which dispensaries are struggling to keep in stock, said Riane Durrett, a spokeswoman for the Nevada Dispensary Association, in a comment to the Gazette-Journal.

Several legal challenges to this bizarre monopoly have been mounted, but judges have thus far declined to open up the market. Until they do, you may be better off heading to Portland or Denver for a cannabis getaway — or stowing your own stash away before jetting off to the desert.

TELL US, have you tried to buy cannabis in Nevada yet?

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