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The Street
The Street
Business
Tony Owusu

Cannabis News Week: DOT Takes on CBD; New Mexico, Canada Numbers

The dual legal status of cannabis continues to cause the confusion one would expect from a drug being illegal at the federal level while being legal in certain states.

A couple of weeks ago the Nevada Supreme Court ruled in Ceballos v. NP Palace, LLC that the state law protecting "legal activities" or "lawful off-duty conduct" does not apply to recreation marijuana use.

Danny Ceballos is a former table games dealer at the Las Vegas Station Hotel & Casino who suffered a minor workplace injury in June 2020. Ceballos tested positive for marijuana on a post-accident drug test and was subsequently fired.

Ceballos claimed that he was not impaired during work and had not used cannabis within the 24 hours prior to the incident. However, the state's top court found that the state's law does not protect him in this instance.

"Although Nevada has decriminalized adult recreational marijuana use, the drug continues to be illegal under federal law. Because federal law criminalizes the possession of marijuana in Nevada, its use is not 'lawful... in this state,'" the state ruled.

DOT Proposes New Rules for CDL Drivers

Even the federal government is struggling to navigate these new regulatory waters, and last week, the agency proposed new guidelines for truck drivers who want to use CBD (cannabis without the ingredients that get you "high") products.

Commercial drivers who use CBD products are doing so "at their own risk," according to a draft handbook being prepared for medical examiners responsible for issuing U.S. Department of Transportation certifications, Marijuana Moment reported.

The Federal Motor Carrier Safety Administration handbook currently says that drivers aren't barred from using CBD products that contain up to 0.3% THC per dry weight.

But the FMCSA also warns examiners that use of non-intoxicating cannabinoid could still cause the failure of physical exam certifications to which some drivers are required to submit.

“The federal government should be making it easier for already-qualified drivers to stay in the profession, not forcing them away," Rep. Earl Blumenauer (D-OR) said in a letter earlier this year to Transportation Department Secretary Pete Buttigieg.

Outmoded and unfair federal drug policies are out of step with reality and directly contribute to the trucking shortage crisis.

New Mexico Oversupply Issues

The line between enough supply and oversupply is razor thin in some U.S. cannabis markets as the industry figures out exactly how much pot it needs to satisfy users.

New Mexico cannabis retailers have experienced a supply crunch as markets go through growing pains after the recreational industry went live on April 1.

"On day one it’s going to be a challenge as it’s going to be a challenge for maybe as long as 9 to 12 to 18 months,” said Duke Rodriguez, Ultra Health president, according to KRQE.

But Ben Lewinger, executive director of the New Mexico Cannabis Chamber of Commerce, says that the tide is turning for the industry as wholesale price per pound declines.

"Now it's in the $2,200-$2,500 range [after being in the $4,000 range], because there's more availability and people have connections to support a vibrant wholesale market. I think that's only going to get better, Lewinger said, according to MJBizDaily.

New Mexico's marijuana market is expected to reach annual sales of up to $125 million this year and grow to as much as $400 million, based on MJBiz projections.

The state of 2.1 million reported July sales of $40.3 million, its strongest month ever.

Canada Cannabis Sales Continue Rebound

Canadian cannabis numbers experienced another uptick in June, according to new data from the country, marking the fourth straight month sales have increased in the country of 38 million.

Sales in the country rose to C$377.5 million ($289.7 million), a 0.7% increase from May's revised C$373.6 million (down from C$375.8 million), according to Statistics Canada.

Year over year, sales gained 23%, also an increase from the 19.5% year-over-year increase seen in May. The sequential increase occurred despite one less day of sales in June compared to May.

"An increase in the number of stores as well as falling flower prices that bring consumers from the illicit market have been boosting sales," according to New Cannabis Ventures.

Ontario, Canada's most populated province, led the way with sales of C$152.2 million, an increase over the C$147.4 million haul from the previous quarter.

Sales of C$67.2 million and C$54 million from Alberta and British Columbia, respectively, rounded out the top three in the country.

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