Background

Manufacturing licenses are the least prone to cyclical swings in terms of issuance. There are currently just over 6,200 manufacturing licenses in the Cannabiz Media License Database at 5,800 facilities. Cannabiz Media categorizes a license as a manufacturer if it fits the following description: License is for the processing (manufacturing) of marijuana-infused products, such as edibles or concentrates, but does not include cultivation or retail sale to customers. 

Key Findings

• Only 16 states issued manufacturing licenses in Q1 2023.
• Oklahoma led the nation in new manufacturing licenses issued with 338 (54%).
• Expanding programs like Vermont, Mississippi, and New York also contributed in Q1.
• 84% of the new licenses came from three states: Oklahoma, Michigan, and New Mexico.

In Q1 2023, we tracked only 16 states issuing new manufacturing licenses ,and most came from a few states with Oklahoma accounting for 64% of these, though only 18 new licenses were issued in March.

The time series below shows a slight upward trend certainly helped by the large cohort in January from Oklahoma:

Leaderboards

Here’s the Leaderboard comparing Year End 2022 with Q1 End 2023. There has been a slight uptick in licenses, once again, driven by Oklahoma. When we remove the Oklahoma license counts, as shown below, we see that the leaderboard nationwide would have increased by only nine licenses!

Conclusion

Licensed cannabis manufacturers are not immune to the challenges facing the industry. These include more consolidation and streamlining operations, price compression in oversaturated markets, high interest rates and challenges raising capital, and formerly limited license states expanding license numbers. The unlicensed market continues to have an outsized impact across the license value chain. 

There are more states nudging their way to new or expanded programs that may create more manufacturing in certain markets. However, given the expense of equipment, license moratoria, and economic headwinds, I do not envision many new licenses being issued in Q2.

Author

Ed Keating is a co-founder of Cannabiz Media and oversees the company’s data research and government relations efforts. He has spent his career working with and advising information companies in the compliance space. Ed has managed product, marketing, and sales while overseeing complex multijurisdictional product lines in the securities, corporate, UCC, safety, environmental, and human resource markets.  

At Cannabiz Media, Ed enjoys the challenge of working with regulators across the globe as he and his team gather corporate, financial, and license information to track the people, products, and businesses in the cannabis economy.  

Ed graduated from Hamilton College and received his MBA from the Kellogg School at Northwestern University.

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