Illinois Cannabis Retailers Achieved $2 Billion in Legal Sales in 2023, Setting a New Monthly Record in December

In Illinois, the retail sector for cannabis experienced a notable increase in sales as the year 2023 came to a close, establishing new records for monthly sales. December saw cannabis retailers achieving sales of $181.8 million, a historic peak. This unprecedented amount included a remarkable $153.9 million from adult-use cannabis sales. Moreover, December witnessed the highest sales of medical cannabis since April, totaling $27.9 million.

The total sales of legal cannabis in Illinois for 2023 set a new yearly record, reaching close to $2 billion. This substantial sum was largely contributed by over $1.6 billion from the state’s adult-use market, which has been in operation for the past four years. This significant growth in the cannabis market reflects the growing acceptance and demand for these products in Illinois.

The state also reaped considerable financial benefits from the sale of recreational cannabis. In 2023, the Illinois Department of Revenue noted that the state collected a substantial $417.6 million in tax revenue from these sales. This income is a crucial source of funding for various state initiatives and programs.

Governor J.B. Pritzker (D) underscored the state’s dedication to fostering an equitable and accessible cannabis industry in a press release that announced these fiscal details on Thursday. He stated, “From day one, my administration has put equity first to build the most accessible cannabis industry in the nation.” He also highlighted the continuous efforts to rectify historical wrongs while providing opportunities throughout Illinois. This strategy is aimed at creating a more prosperous future for the state by using the cannabis industry as a driver for economic and social progress.

These developments in Illinois’ cannabis market are part of a larger trend of growth and normalization of cannabis sales throughout the United States. The approach of the state, focusing on equity and accessibility, serves as an exemplar of how the cannabis industry can positively contribute to economic growth and social justice efforts. The focus of Governor Pritzker’s administration on these elements highlights the potential of the cannabis industry to be a beneficial force in society, extending beyond its commercial achievements.

Illinois Monthly Cannabis Sales

Illinois Cannabis Industry Sets Records and Advances Social Equity in 2023

Lieutenant Governor Juliana Stratton (D) emphasized the profound impact of legalizing adult-use cannabis in Illinois, particularly in terms of uplifting communities that were disproportionately affected by the unsuccessful war on drugs. Stratton noted, “The legalization of adult-use cannabis was the start of uplifting the communities most impacted by the failed war on drugs.” She further elaborated that the revenue generated from these sales is earmarked for reinvestment into the economic growth of historically underfunded populations, signifying a commitment to rectifying past injustices and promoting equitable development.

This progressive stance on cannabis sales in Illinois is underscored by the new sales records achieved. Following a notable record set in November for the highest-ever cannabis sales to in-state residents, as reported by the Illinois Department of Financial and Professional Regulation (IDFPR), December witnessed yet another record-breaking month. State residents contributed $117.9 million to these sales, underscoring the growing acceptance and demand for cannabis products among Illinois residents.

Illinois cannabis retailers concluded the year 2023 on a high note, recording sales of $181.8 million in cannabis products during December alone. This total included a record $153.9 million in adult-use purchases and $27.9 million in medical cannabis sales, the latter reaching its highest point since April. These figures collectively contributed to setting a new annual sales record for legal cannabis in Illinois, totaling nearly $2 billion. This sum included more than $1.6 billion from the state’s adult-use market, which was launched four years prior.

The fiscal impact of recreational cannabis sales was substantial, with the Illinois Department of Revenue reporting that these sales generated $417.6 million in tax revenue for the state in 2023. This revenue stream has become a significant contributor to the state’s finances.

Governor J.B. Pritzker (D) highlighted the administration’s commitment to building an accessible and equitable cannabis industry in a press release announcing the fiscal data. “From day one, my administration has put equity first to build the most accessible cannabis industry in the nation,” Governor Pritzker said. He emphasized the continuous endeavors to rectify previous injustices and offer opportunities to communities throughout Illinois, to foster a more prosperous future for the state.

In terms of state revenue, the legal cannabis industry contributed approximately $451.9 million to Illinois in fiscal year 2023, according to figures from the Department of Revenue. This revenue from cannabis sales notably surpassed that from alcohol sales, which brought in about $316.3 million during the same period.

During the fiscal year, a total of 200 conditional licenses were issued. Furthermore, in December 2022, the department finalized rules for a new Social Equity Criteria Lottery, designed to give priority to individuals disproportionately impacted by the war on drugs. This initiative saw over 2,600 applicants for 55 new social equity dispensary licenses, demonstrating a significant interest and participation in the state’s efforts to promote social equity in the cannabis industry. These advancements reflect Illinois’ sustained dedication to cultivating a cannabis market that is not only economically successful but also acts as a catalyst for social justice and equity.

Cook County Leads in New Cannabis Licenses Amid Rising Diversity and Industry Growth in Illinois

In Illinois, a significant portion of the new licenses issued for cannabis operations were concentrated in Cook County, the most populous county in the state. This distribution underscores the county’s prominent role in the state’s growing cannabis industry and reflects the increasing demand for cannabis products in urban areas.

A recent report from the state’s Cannabis Regulation Oversight Officer has provided encouraging news regarding diversity in the cannabis industry. The report highlights a substantial increase in diversity among cannabis business owners since the inception of adult-use cannabis sales. This positive development is a clear indication that the state’s recent initiatives to prioritize social equity applicants in the licensing process are having a tangible effect.

At the start of recreational cannabis sales in 2020, the industry was predominantly White-owned, with 100% of the initial businesses falling into this category, and only one business being majority woman-owned. This lack of diversity was a significant concern. However, the state has since seen notable improvements in this area. According to the diversity survey report released by the state office, there has been a marked increase in the representation of various demographic groups within the cannabis market from 2020 to 2023.

Black-owned companies, which initially had no representation, now account for 27 percent of the market. Similarly, Latino/a or Hispanic-owned and Asian-owned companies have seen their presence grow from 0 percent to 5 percent and 3 percent, respectively. Furthermore, the proportion of women-owned businesses in the cannabis sector has risen to 16 percent, highlighting a positive trend towards gender diversity in the industry.

Despite these strides in diversity and market expansion, small-craft cannabis growers in Illinois are reportedly facing challenges, even with millions in state aid. These small-scale operators are struggling to compete in a market that is increasingly dominated by larger, more established companies.

In terms of consumer pricing, Illinois residents are reportedly paying more for cannabis compared to buyers in many other states with legal cannabis markets. Governor J.B. Pritzker recently addressed concerns about high prices, emphasizing the industry’s steady growth and the significant sales generated from out-of-state customers, which help boost the local economy.

In a move to further support the industry, last month, Governor Pritzker signed a bill into law that eliminates application fees for existing cannabis transporter organizations until January 1, 2027. This legislative action is part of the state’s ongoing efforts to reduce financial barriers and encourage the continued growth and development of the cannabis industry in Illinois. These efforts showcase the state’s dedication to developing a vibrant and inclusive cannabis market, while also recognizing the obstacles encountered by smaller entities in the industry.