Cannabis sales were soaring in March, especially during the first half of the month as the coronavirus became a global pandemic. Washington state saw a 9% increase in March’s revenue from cannabis compared to the prior year, California’s sales were up 53% year over year (although in previous months, its growth rate was around 75%), and Oregon posted record monthly revenue of $84.5 million, up from $61.2 million a year ago.
Pot sales were soaring, but they were also slightly inconsistent. California-based cannabis cultivator Goldenseed recently surveyed marijuana users across the country and found three key reasons demand was up in March. Let’s take a look at the factors driving increased cannabis sales to see if this is a trend that may continue and what it tells us about investing in cannabis stocks today.
Consumers are concerned about a pot shortage
The main concern among those surveyed is the fear of a cannabis shortage as a result of the coronavirus pandemic. A total of 35% of respondents said this was the most pressing issue for them. Point-of-sale data from Headset, which tracks recreational cannabis sales for multiple states, corroborates these findings. Mid-March is when consumers were stockpiling their supply of cannabis — just days after the World Health Organization declared the coronavirus a pandemic. Cannabis sales surged in California, Washington, and Colorado before falling in the following weeks.
Dealing with stress and anxiety
Using pot to deal with stress isn’t uncommon. In fact, 40% of marijuana users said they were using more pot during the pandemic and 74% said stress and anxiety were the main reasons for their current cannabis use. With news stations running alarming headlines around the clock about the coronavirus pandemic and consumers worried pot supplies may become scarce, it’s not hard to see why anxiety and stress levels are high.
New Frontier Data conducted a similar survey in 2017 that found relaxation was the main reason (55%) people turned to cannabis. However, stress and anxiety didn’t rank far behind, coming in at 40% and 39%, respectively. (There was no combined percentage of the two.) But it does suggest that relaxing or relieving stress or anxiety remains the key reason for cannabis use. And with stress levels higher as a result of the pandemic, it certainly makes sense that people are consuming more cannabis right now.
Boredom in isolation
One of the more surprising responses from the Goldenseed survey was that more than 37% of people indicated they were consuming pot was to relieve boredom. This was not a result on the 2017 New Frontier Data survey, so it might be a result of people who are in isolation due to the pandemic and are looking for ways to pass the time when they can’t go about their normal social lives.
What impact might this have on the cannabis industry?
The coronavirus has been an official pandemic for about a month and the one thing investors shouldn’t do is read too much into short-term trends. The sales data and the survey results do suggest some changes in buying patterns, with consumers making large purchases more sporadically. However, that could change as consumers deal with job losses and financial challenges that lie ahead.
- Zenpype.com is an educational website dedicated to shedding the light on many sides of medical and recreational cannabis. Aside from informing people about cannabis, we also provide cannabis seeds and CBD products. Readers who show their support with purchasing, help us keep doing this. Thank you for your support and for helping us improve!