sive state and federal regulations, and often local policies. They bear a heavy federal tax load of up to 80% and a lack of access to banking and capital. They can’t sell in other states (due to ongoing federal prohibition, marijuana products must be sold in the state where they were manufactured). And adding insult, rising labor and material costs squeeze at the margins. Market saturation and a change in growing conditions caused the bottom of the market to drop out, and by 2017, Oregon’s green rush was over. In March of this year, the price of a gram of cannabis was about $4, and sales had fallen by 4%, according to data released by the Oregon Liquor and Cannabis Commission. “We thought, ‘This seems too good to be true,’ and immediately, it was too good to be true,” Collins says. GREEN SLUMP In the space of a decade, marijuana has become a major U.S. industry with $31.5 billion in revenue last year ($1 billion in Oregon). But experts say Oregon’s pot industry is one of the country’s least healthy. Among the first states to legalize, it didn’t set an upper limit on marijuana business licenses, which led to more product than Oregonians could ever consume. The state today struggles with rock-bottom wholesale prices, million-pound stockpiles of unsold inventory and stagnant demand. While $1 billion in revenue might sound lucrative, given Oregon’s extreme market saturation, for most businesses it’s not. Spread over 2,400 active licenses, $1 billion in revenue works out to around $400,000 per business, and that’s not much to operate on. Companies often have little left over to spend on tax prep, marketing and other ancillary services, according to Mike Getlin, an Oregon City weed farmer and board president of the Cannabis Industry Alliance of Oregon (CIAO). “Most of these businesses aren’t raking it in,” Getlin says. “We thought, ‘This seems too good to be true,’ and immediately, it was too good to be true.” DOC COLLINS, CO-FOUNDER, THE HOOD COLLECTIVE Decater “Doc” Collins, CEO of Hood Collective cannabis marketing photographed at a grow operation in Northeast Portland. 25
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