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The continued decline of cannabis sales in Colorado is seeing a boom in lower THC cannabis products.
According to 9 News, local dispensaries are now targeting consumers looking for functionality and wellness benefits rather than an intense psychoactive experience.
Speaking to the local news outlet, Adam Scheffler, area manager for Terrapin Care Station, explains that typical THC gummies on the market contain a 10-milligram dosage.
However, demand is shifting toward products with half that potency—or even less.
“People are looking for more functionality, truthfully, throughout the day,” Scheffler said. “Not looking for that completely blitzed-out feeling where they can’t get things done.”
Lower-dose THC products are particularly appealing to consumers over 50, a demographic increasingly using cannabis for wellness purposes. A 2023 AARP report revealed that one in five adults over 50 uses cannabis, with 68% of respondents citing sleep improvement as their primary reason.
Scheffler noted that many customers are seeking solutions for anxiety and sleep.
This latest trend is being driven by falling sales in the state, with sales and tax revenue plummeting to levels not seen since 2018.
Retailers are looking to diversify their offerings and audiences in a bid to boost sales with new demographics.
The state’s cannabis tax collections peaked in the 2020-21 budget year at $424 million, but have since fallen by 41% to $248 million in the 2023-24 budget year. This decline is a stark contrast to the pandemic-fueled boom in cannabis sales, and it’s now clear that those boom times are behind us.
The rise of intoxicating hemp products is likely a major contributor to the decline in cannabis sales.
The 2018 federal Farm Bill, which legalized hemp, has led to the creation of a $2.2 billion market for intoxicating hemp products, including THC-infused seltzers, brownies, and gummies. These products are now widely available in gas stations, farmers markets, and CBD stores across the country, often without the same regulatory oversight as cannabis. As a result, they’re siphoning off customers from the highly regulated cannabis industry.
Colorado has attempted to restrict these products to licensed cannabis sellers, but the effectiveness of this measure is uncertain. State attorneys general, including Colorado’s Phil Weiser, are pushing for stricter federal limits on hemp due to the legal uncertainty surrounding the industry.
Looking ahead, the outlook for Colorado’s cannabis industry is uncertain. The state’s cannabis tax collections are projected to either level off or decline further, with estimates ranging from $242 million to $267 million for the current budget year.
Other states that were early legalizers of marijuana, such as Washington and California, have also seen revenue declines, although not as steep as Colorado’s. As the intoxicating hemp market continues to grow, it’s likely that the cannabis industry will face increasing competition, making it even more challenging for businesses to thrive.
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