Marijuana advocates in New Jersey are questioning why Curaleaf Holdings is reducing production in a state that has some of the highest cannabis prices in the United States – a sign the market isn’t as well-supplied as the company says it is.
Further, regulators have added more than 130 retail and manufacturing licenses to the state, according to the New Jersey Monitor.
“It doesn’t make any sense for them to be closing the grow and laying off all these employees, just as small businesses get their licenses and could be buying these products,” said Chris Goldstein, a regional organizer with Washington DC-based NORML.
Curaleaf laid off 49 employees at its Winslow production facility earlier this month.
The New York-headquartered multistate operator attributed the decision to the state’s “ample supply” of marijuana in its stores.
Curaleaf also laid off 40 workers in the state in March.
“The current 35 existing licensed dispensaries in New Jersey are insufficient to meet the needs for a state this size and far fewer than what were led to believe would be opened,” Curaleaf CEO Matt Darin said in a statement to the Monitor.
“These market realities make it unsustainable to continue producing cannabis products at current levels, compelling us to scale back production,” he said.
Toni-Anne Blake, a spokesperson for the New Jersey Cannabis Regulatory Commission, said the agency has approved 138 new licenses for manufacturing or retail businesses.
Marijuana wholesale data isn’t publicly available, and neither regulators nor Curaleaf would share details about wholesale sales or supply in the state.
According to the Monitor, an eighth of regulated marijuana flower in New Jersey Curaleaf stores can cost consumers up to $60.
Prices also haven’t been declining, according to Goldstein.
In more mature, oversupplied markets, the price for an eighth can be as low as $10.
MSOs such as Curaleaf possess all 15 of New Jersey’s cultivation licenses.
“There’s two words that really describe this type of behavior: market manipulation,” Goldstein said.
“Unfortunately, we’ve gotten used to this in New Jersey’s cannabis industry.”
