2024 has been a surprisingly still year for the cannabis industry, with Ohio’s adult-use market launch on August 6 standing as the year’s sole highlight. The industry, which once enjoyed consistent and rapid geographic expansion, saw no other states introduce new recreational or medical programs this year.
This slowdown comes in stark contrast to last year when three states—Maryland, Missouri, and Mississippi—rolled out their respective programs, marking a robust year for cannabis adoption. Ohio now joins 20 other U.S. states offering recreational marijuana sales, but the nearly year-long gap between launches signals a notable pause in the industry’s momentum.
So, what’s holding things back?
Why the Slowdown? Funding and Legislative Hurdles
One of the leading reasons behind the absence of new markets is the lack of funding for advocacy groups, according to Karen O’Keefe, state policies director for the Marijuana Policy Project.
“We would have had a much better chance of achieving victories in New Hampshire, Hawaii, and South Dakota in 2024 if we had adequate resources for a robust campaign,” O’Keefe said.
This drop in support has prevented states from passing the necessary legislation or pushing legalization efforts forward. Meanwhile, Georgia was the last state to open a medical marijuana market back in October 2023.
Despite stalled state launches, some regions, including New York and Florida, have found other opportunities to grow, whether through expanded licenses or improved infrastructure.
Ohio’s Market: An Early Look at Sales and Challenges
Ohio’s adult-use cannabis market started strong but has already faced hurdles. In its first month, sales topped $44.1 million. However, a slight dip followed in September, suggesting the market may not sustain rapid growth immediately:
| Time Period | Sales Figures |
|---|---|
| Aug. 6-31 | $44.1 million |
| Sept. 1-28 | $43.1 million |
| Sept. 29-Nov. 2 | $56.2 million |
| Nov. 3-30 | $48.0 million |
These fluctuations reflect multiple challenges. Ohio’s adult-use program currently operates under its pre-existing medical marijuana rules, which include bans on pre-rolls and product potency limits.
“Temporary product restrictions are partly to blame for waning sales figures,” shared local industry insiders. Notably, pre-rolls—hugely popular in other states—remain off the table in Ohio, limiting transaction volume.
One other factor? Ohio’s proximity to Michigan. Neighboring Michigan has emerged as a cannabis powerhouse, offering lower prices that attract Ohio-based consumers looking to save a buck.
Retail Prices: Falling Fast but Not Fast Enough
Since the August launch, cannabis prices in Ohio have steadily declined. For context:
- The average price of a tenth of an ounce fell 20.8%, from $26.59 to $21.05.
- Price per gram dropped 20.9%, from $9.40 to $7.44.
- Manufactured products like edibles and vapes dipped 9.4%, now averaging $28.13 per unit.
This price decline is good news for consumers but highlights some of the financial strain retailers face as they compete for a limited customer base.
A Unique Rollout with Strict Regulations
Another standout challenge in Ohio’s launch is its marketing restrictions. Regulators introduced stringent rules in July, which included bans on celebratory decor, outdoor music, and even the use of the term “recreational” in promotions.
In August, regulators slapped over $200,000 in fines on five dispensaries for violating these marketing rules.
These restrictions have hampered awareness about the new market. Companies like Curaleaf Holdings, a major multistate operator, turned to word-of-mouth and in-store experiences to compensate.
“Sales at our two locations have exceeded expectations,” said Luke Flood, Curaleaf’s senior vice president. “We’ve also successfully retained our medical patient base while welcoming a surge of new adult-use customers.”
Insa, a Massachusetts-based retailer with an Ohio location, echoed similar experiences. The company focused on offering a wide range of products to gauge consumer preferences early on.
A Glimpse at the Broader Industry
While new states haven’t come online in 2024, growth continues in existing markets:
- New York: Regulators approved 68 additional licenses, pushing the state’s total to 265—a 562% jump from 2023. Despite early struggles, New York’s adult-use sales are on pace to exceed $1 billion this year.
- Florida: While adult-use legalization failed to pass in November, the state expanded its medical marijuana licensing, granting 72 permits to hopeful dispensaries.
For Ohio, this slow but steady expansion could signal long-term potential, even if growing pains persist in the short term.
The adult-use market now accounts for roughly half of sales at leading dispensaries, proving the appetite is there. However, industry leaders stress the need for regulatory updates to address issues like product restrictions and consumer access.
“Like any industry, we’ll continue to look for ways to improve, change, and pivot,” said Thomas Haren of the Ohio Cannabis Coalition.
Ohio might be the lone cannabis launch of 2024, but it serves as a case study for what future markets can expect: steady growth tempered by tight regulations and competitive pressures.