I’m wondering where the NY recreational market stands at the moment and if anybody has an understanding of the future/timeline. Some specific questions I’m wondering:
It seems like the current timeline for issuing actual recreational store licenses is 2023, but most of the rules/regs behind it are still in the “proposed” stage. Does anyone have insight on that timeline, number of licenses, who will be given priority?
NY seems like a big market because of NYC, but I’m wondering about the potential for the market/jobs outside of the greater NYC area, specifically upstate.
I’ve been looking for specific proposed rules/regs around extraction and can’t find them. I’m seeing requirements for processors/applications, but not specifics about forms of extraction allowed and other specifics suchs as manadatory requesting limits, etc. It seems like the medical market is largely ethanol/CO2. Insights?
What are other things that an extractor from away should know about the opportunities and challenges of this state.
We have ops in NY. Everyone with a medical license is stocked to the gills with product waiting to transfer to rec. I think we have 100+ liters of distillate on our shelves.
Social equity applications and conditional licenses are the only ones being given out now. Optimistically general apps will be accepted at the end of this year, but more realistically early 2023.
They are rolling it out very slow.
Almost everything is greenhouse / outdoor as far as approved conditional cultivation licenses. There’s something in the law about limiting artificial lights to 20 total for conditional grows, waiting for clarification.
They’re finally knocking out some of the “grey” area operators and cracking down on the food trucks offering “free weed” with their 40 dollar hamburgers. This week they had a ton of CAURD meetings all over the city trying to get dispensaries opened up by social equity cases, so I imagine this is why they want to clear out some of the illicit market.
I know of one place that shelled out for a nice brooklyn location for a dispo only to have a bodega downstairs with a back room fully stocked. I don’t think they do any legal sales there. LMAO.
It’s pretty funny that NY went from being the biggest investment MSO/general cannabis opportunity to a state that everyone wants to avoid and is writing off, with the gray market activity+social equity licensing
The conditional retail license application period opens on August 25 and closes on September 24, but these conditional retail licenses are reserved only for justice involved individuals which means an individual (or a close family member of an individual) who has been convicted of a marijuana related crime in NY. There will be about 100 of these licenses and the state expects to have the first handful open for business before the end of 2022. After these licenses are issued, “social equity” applicants will probably get priority for the next round of licensing and it remains to be seen when that round will open.
There are currently 240 or so conditional cultivator licensees, the majority of which are upstate so you will probably have the best luck looking for work outside of the NYC area by reaching out to these cultivators. There are also 15 conditional processor licensees and I expect the state to issue more conditional processor licenses over the next few weeks. Again, I think a good portion of these licenses are upstate.
While there are no regulations yet for processors, the OCM did release a 20-page guidance document which you can find here: https://cannabis.ny.gov/system/files/documents/2022/08/aucp-guidance-8.17.pdf. These are the rules of the road processors must abide by until full regulations are released. The OCM also issued proposed regulations for packaging/labeling and marketing/advertising which are relevant to processors. The comment period closed last Monday so it will probably be about another month until OCM issues revised regulations that take into consideration all the comments they received. Here’s a link to the proposed regs: https://cannabis.ny.gov/system/files/documents/2022/06/part-128-and-129-plma-regs-final-draft-6-1-2022-v2.pdf
The most important thing to know is how the industry in NY is structured. Unlike many other states, NY’s cannabis industry is modeled closely after NY’s alcohol beverage industry and the legislation includes “tied-house” prohibitions just like alcohol beverage. For example, a cultivator or processor or person with an interest in a cultivator or processor license, is prohibited from having any interest at all in a retail license. Cultivator and processor licenses are also prohibited from giving anything of value to retail licensees. While there are exceptions, they are nuanced and I expect many folks to get tripped up by these unfamiliar rules.
Thank you so much for this. That is a great distillation. The justice involved priority piece is very interesting. I can see the intent and possible benefits, but I also see the deformity in it.
I remember looking at NY medical requirements that were codified in 2020 and extraction processes were limited to CO2 and alcohol. The link you provided regarding Processor Guidance shows that hydrocarbons are allowed so long as processing areas comply with typical standards.
You’re right that late 2022 remains the target date for retail sales to the recreational market in NY.
The just involved retail licenses certainly has a noble, first of its kind intent, but it remains to be seen how effective it will be in achieving the state’s goal of righting the ship for folks who have been disproportionately impacted by the war on drugs. In addition to awarding the first 100 or so retail licenses to justice involved individuals, NY also set up a $200m public/private equity fund that will be leasing the retail properties, doing the build-outs for those properties, and then subleasing the properties to the winning retail applicants. The state will also be assigning the retail locations for the justice involved applicants; while they can rank “geographical zones” across the state by preference on their application, the state will ultimately decide where the applicant gets to open its business. Again, this is just for the first 100 or so retail licenses.
That might make all the difference seeing as how many MSOs are chomping at the bit there. Maybe 1/3 of those equity startups will survive the first year now.
For sure, but it remains to be see when the 10 medical licensees (almost all of which are MSOs) will be able to transition into the adult-use market. Still hasn’t been any guidance on that.
NY is giving the first mover advantage to hemp farmers/processors and justice involved individuals as opposed to NJ which gave the first mover advantage to the existing medical operators. Always interesting to see the juxtaposition of neighboring states’ policies when launching an adult-use market.
In my opinion compartmentalizing, separating and heavily regulating each aspect of the process will tend to force the price of the final product significantly up for obvious reasons. It will also create a very tight profit margin for each one of the compartmentalize businesses in the chain of supply. I think the end results would be that the black market will thrive and thus law enforcement will have to get involved to keep the tax money flowing to the government which will surely be addicted to it after getting its first taste… Which in turn will put people in the marijuana business into prisons and thus completing the circle of bullshit.