Alaska legalized adult-use marijuana in 2014 and successfully launched licensing in 2016. Alaska’s marijuana market is rapidly evolving and developing into a stable, flourishing industry. Due to the state’s small population base, with fewer than 1 million residents, there have been concerns regarding the ability of the market to absorb all the marijuana produced in the currently uncapped licensing system. However, Alaska’s wholesale price of bud has remained resilient; depending on THC/CBD content, the average wholesale price for flower ranges from $2,000 per pound to $4,300 per pound. Many boutique cultivators have pleasantly surprised the market and are typically able to wholesale toward the higher end of the price spectrum. This has spurred much-needed localized economic activities and has provided many Alaskans with self-supporting income for themselves and their small crew of employees. Larger cultivators are selling in the mid-range of the price spectrum and are considering venturing out into retail and manufacturing.
Currently, there are approximately 230 operating cultivators, 121 retailers, 39 manufacturers (including both concentrate-only licenses and product manufacturing licenses) and four testing facilities. Personally, I believe that the market is currently very healthy, but I also believe that if the licensing does not get capped and limited starting in the beginning of 2021, the regulated market will become oversaturated.
Onsite consumption was approved by the Marijuana Control Board in March 2019, and several retailers are opening onsite consumption venues. In Anchorage, only onsite consumption of edibles is allowed, whereas in Fairbanks, inhalation and edibles are permitted. Consequently, Anchorage has yet to see the development of an onsite consumption cafe. However, in places like Fairbanks, companies like Good Titrations are developing swanky inhalation lounges, equipped with a full-scale restaurant for its clientele.
The Alaska marijuana industry has been a shining star in the state’s recent economic downturn due to declining oil prices. In 2020 alone, the Alaskan cannabis industry has brought in more than $19 million in tax revenue and sold more than 37,000 pounds of marijuana as of April 2020. The industry has generated more than 7,300 plant-touching jobs since its inception, in addition to ancillary jobs like contractors, architects, accountants, etc. The Alaska marijuana industry is steadily growing, thriving and becoming a real source of revenue for the state and for the communities. Responsible local leadership, industry leadership and community support will determine the longevity and health of the market in the long term.
Jana D. Weltzin | JDW Counsel
Jana D. Weltzin is the owner of JDW Counsel, a boutique law firm based in Anchorage, Alaska, that represents over 100 licensed marijuana companies in Alaska and Arizona. She has been immersed with marijuana licensing, compliance, land use permitting, and corporate law since early 2013, and is widely recognized as an expert in the field. Jana was recognized as a 2017 Marijuana Venture Rising Stars of Cannabis, 40 under 40. She has contributed to multiple publications, including Marijuana Venture, and has been quoted in numerous media outlets, including Rolling Stone, Leaders in Law, Alaska Public Media, MSN, ABC News, Marijuana Business Daily, and others. Jana is also a founding board member of the Alaska Marijuana Industry Association, maintains an appointed seat on the Anchorage platting board.