The nation’s marijuana industry has boomed during the pandemic. So far, 2022 is looking like a bust. Weed sales hit $27 billion last year, nearly doubling figures from just two years earlier — and revenues are projected to double again over the next six years. Even pot supporters in Congress seemed well-positioned to dismantle decades-old restrictions. But the still-green industry is mired in a financial funk: Stock prices have plummeted. Capital raises have crashed. And marijuana prices have slumped. “There’s a lot of assets just not worth anything, so they’re just going to go away,” said Morgan Paxhia, co-founder of pioneering cannabis investment firm Poseidon Asset Management. “We’re seeing defaults picking up; we’re seeing businesses shuttering.” While a new glut of semi-legal weed has helped sink prices, industry executives and investors say the lack of progress on federal marijuana legislation is the single biggest factor driving the sector’s economic downturn — and it’s unclear when their odds will improve. After Democrats won total control of the federal government in 2021, optimism swept the industry that Congress and the Biden administration would loosen restrictions on the drug and make it easier to run a profitable business.
Politics, Policy, Political News – POLITICO, 04/19/2022 20:00:00
Open article: https://www.politico.com/news/2022/04/20/weed-cannabis-sector-financial-00026359