After the Jan. 1 launch, some Illinois adult-use cannabis retailers have cut off customers temporarily to conserve inventory, recreational marijuana sales in Michigan hit almost $6.5 million in first month, Harvest Health & Recreation looks to terminate an acquisition – and more of the week’s top MJ business news.

Huge rec sales in Illinois lead to some shop closures

The start of recreational cannabis sales in Illinois went off like a rocket, with high demand wreaking havoc on many carefully laid retailer plans.


Some shops even had to stop serving adult-use customers temporarily to ensure they have enough inventory to cover medical marijuana patients they serve.

MJBizDaily takeaway: The snafus in Illinois should smooth out soon enough as both cultivators and retailers ramp up. And, if anything, it’s a positive reminder of how much demand exists nationwide for recreational cannabis.

With more business licenses on the way in Illinois, the state is poised to become a major market that will serve Midwestern customers, alongside Michigan – the only other U.S. state between Colorado and Massachusetts with recreational marijuana for sale.

Michigan reaches nearly $6.5 million in adult-use sales in first month

Sales of recreational marijuana in Michigan reached almost $6.5 million during the first month of legal sales in the state.

MJBizDaily takeaway: Sales of adult-use cannabis in Michigan kicked off Dec. 1, 2019, and are expected to grow quickly this year as dozens more adult-use retail stores become licensed. That is despite uneven business opportunities across the state due to local municipality constraints on the recreational cannabis industry.

As of Jan. 2, the Michigan Marijuana Regulatory Agency issued 54 recreational cannabis business licenses, including 26 retail permits. That’s nearly twice the number of licenses that had been predicted, according to the agency.

Harvest Health halts one deal, looks at another

Arizona-based multistate operator Harvest Health & Recreation said it wants to scrap its previously announced purchase of Falcon International. Meanwhile, the company intends to pay about $87.5 million to purchase Interurban Capital in Seattle, which operates 11 Have a Heart stores in three states.

MJBizDaily takeaway: Restructuring or outright cancellation of previously announced M&A deals has become a fact of life in the U.S. cannabis industry in recent months amid falling marijuana stocks and a shortage of outside capital.

Given that the Falcon deal was announced almost a year ago, it’s likely such conditions factored into Harvest’s decision.

At the same time, Harvest Health is one of the more aggressive cannabis multistate operators in terms of merger activity, and the Have a Heart move might mark a better opportunity in the current climate.

Vireo ratifies union pact in Maryland

Vireo Health signed what it says is the first medical cannabis union agreement in Maryland.

MJBizDaily takeaway: The Minnesota-based multistate operator has become the industry leader in embracing unionization, with collective bargaining agreements also in place in Minnesota, New York and Pennsylvania with the United Food & Commercial Workers International Union (UFCW).

illinois recreational marijuana | recreational marijuana michigan | harvest health, Week in Review: IL adult-use marijuana stores face shortages, Michigan early recreational MJ sales near $6.5M, Harvest pivots on deals & moreLabor peace agreements in the marijuana industry – if not unionization – are increasingly required in different states but have sometimes led to friction between unions and marijuana businesses.

Unionization can increase costs and lead to less operational flexibility.

But Vireo said it makes good business and political sense.

For example, Vireo noted it looks forward to partnering with the UFCW in Maryland on legislation, including adult-use legalization efforts.

Adult-use, medical cannabis measures make South Dakota ballot

South Dakota will become the first state to vote on adult-use and medical marijuana at the same time come November.

illinois recreational marijuana | recreational marijuana michigan | harvest health, Week in Review: IL adult-use marijuana stores face shortages, Michigan early recreational MJ sales near $6.5M, Harvest pivots on deals & more

(Photo by Christa Madrid)

MJBizDaily takeaway: Public support is strong for legalization in the state, but experts predict significant opposition.

The market is small, with less than 1 million people. The state would determine adult-use licensing with a mandate to allow enough businesses to drive out the illicit market but not too many to cause overproduction.

Local governments would have the authority to place limits on medical cannabis businesses in their jurisdictions.