As 2023 enters its 11th month, sales trends in Arizona's cannabis industry continue a familiar pattern for the adult recreational market, more than three times as high as the medical sector.
Recreational sales were $83.5 million in November 2023, while medical sales were flat for the second consecutive month at about $25 million, according to the latest report from the Arizona Department of Revenue.
The medical market fell below $40 million in July 2022 and was on a downward trend to $30.4 million in May 2023. Since then, sales have not exceeded that level, hovering around $25 million.
Medical products sales have consistently declined since a peak of $73.4 million in April 2021. Medical sales are hitting new lows every month.
Recreational sales, which began in late January 2021 after voters legalized sales in November 2020, have fluctuated between $80 million and $93.5 million since July 2022. Since then, it reached a peak of $100 million in March 2023 and has remained flat since then. In the mid to low $80 million range.
For the year ending November 2023, medical marijuana sales totaled more than $320.5 million, and Arizonans purchased more than $978.1 million for recreational purposes, for a total of nearly $1.3 billion.
Since January 2021, the cannabis industry has generated more than $4.2 billion in sales, approximately $2.6 billion of which came from recreational customers. If current trends continue, 2023 cannabis sales should easily match 2022's total of $1.4 billion.
The state collects a 16% sales tax on recreational sales in addition to the standard sales tax. Medical patients pay approximately 6% state sales tax. Local governments impose an additional 2% or so on all marijuana sales.
In November 2023, excise taxes on adult-use marijuana sales brought in about $13.3 million in profits, and medical taxes brought in about $2 million to the state treasury.
One-third of the revenue raised by the recreational sales tax goes to community colleges and transitional community college districts. 31% public safety, including police, fire departments, firefighters, and first responders; 25% will go to the Arizona Highway User Revenue Fund. And 10% will be donated to the Justice Reinvestment Fund. This fund is dedicated to providing public health services, counseling, job training, and other social services to communities that are negatively and disproportionately impacted by marijuana arrests and criminalization.
The Arizona Department of Health Services reported a steady decline in participation in its medical marijuana program as the number of eligible patients continues to decline each month.
As of January, there were 113,694 eligible patient cardholders, down from 115,914 in December 2023. At the height of the medical market, before recreational sales began, the number of patients covered was 299,054.
In January, Arizona medical marijuana consumers purchased 4,100 pounds of marijuana in various forms, down from the 4,636 pounds reported in December 2023. Through 2023, medical marijuana patients in Arizona purchased 65,596 pounds.
