Welcome to 10thousand Oregon’s annual State of the Marijuana publication. A lot of things have changed over the years and I plan to write another review post soon. But for now, let’s talk about everything that happened in 2025 — and that’s a lot.
Sales and market data
According to OLCC datatotal sales from January 1 to November 30 were $848 million. This is a 3.7% drop from the same period in 2024, when total sales were $881 million. Does this mean Oregon cannabis retailers are selling less product? No, not like that. Maybe they are selling more for the price of the discounted models.
Sad retail price trend line continued to decline through 2025. Within this trendline, the extracts/concentrates category hit a low of $15.00 per gram (average) in the extracts/concentrates category in April; it again shows $15.00 per gram for November. Edible marijuana also dropped to an awful $3.33 per gram (average) in April, and has been pretty much nonexistent since then. (Useful marijuana is essentially a flower in the OLCC environment.)
There is no foreseeable end to the price depression: it can only get worse. Croptober 2025 was Oregon’s largest METRC crop with 6,289,890 pounds recorded. This was a significant and unwelcome 8.9% increase in the crop compared to the October 2024 crop, which itself was a record. As I wrote last year:
“I’m sure the illegal market has had a great year as well; the weather is the same for everyone and the enforcement paradigm is static… Consumers may win, but it may not be great for pricing.”
Unfortunately, it came true in 2025 and it will happen again in 2026. As for what people actually buy at all these OLCC stores, I’ve compiled the following table:
2025 year
2024 year
Change +/-
Used marijuana
43.6%
46.2%
-2.6
Concentrate/extract
26%
25%
+1.0
Food / Tincture
14.2%
13.7%
+0.5
Inhalation with supplements without canna
10.7%
9.1%
+1.6
“Other”
4.9%
5.4%
-0.5
Industrial hemp
0% (?)
0.6%
-o.6 (?)
Check it out the fall in the eligible marijuana category. In both 2023 and 2024, I noted a “multi-year trend of declining per capita marijuana sales in favor of other categories.” We’re not just seeing these SKU changes in the data—we’ve had a series of farm customers complaining that retailers are withdrawing flower orders in response to consumer preference for vapes and cartridges.
Bottom line: People are buying more cannabis in Oregon than ever, at lower prices than ever. There is also more hemp than ever in the OLCC market. Looking at this wealth, customers do not burn flowers, as before, but choose packaged products. All of this creates a very challenging business environment, especially for small farms that continue to falter and fail.
Cannabis Licenses and Licensing in Oregon
A years-long moratorium on OLCC licensing in Oregon was ratified by the Legislature in 2024. We still have a one-in, one-out policy whereby outgoing license holders are allowed to surrender (sell) their licenses in favor of new entrants purchasing (buying) replacement licenses. Outside of this buy/sell paradigm, the OLCC is “prohibited from accepting new license applications almost forever due to restrictive formulas based on population-based ratios,” as I explained ago when HB 4121 passed.
In 2025, as predicted, the number of licenses in all areas decreased slightly. This was also the case in 2024 and 2023 due to a long-term moratorium due to business bankruptcy. Here’s a table showing current license numbers compared to this time last year:
2025 year
2024 year
Change +/-
Manufacturers
1,351
1375
-24
Processors
275
288
-13
Wholesalers
243
257
-14
Retailers
769
789
-20
Laboratories
10
13
-3
Studies
1
1
none
The numbers continue to fall on the slow decline we’ve seen for several years, and that’s a good thing. Most would agree that we have too many licenses in all categories except perhaps labs and research. Unfortunately, we lost a couple of labs this year, possibly due to the October 2024 dropout. suppression of THC inflation.
In terms of pricing, we’ve helped people buy and sell producer licenses for anywhere from $60,000 to $85,000 over the course of a year, with prices rising over the past month or two. Most of the deals are relocation and change-of-owner scenarios, and most of the buyers are Chinese. Wholesale licenses and CPU licenses are sold less frequently and at lower prices; retail pricing is a separate animal that depends heavily on store performance. However, we did help sell a couple of $100K retail licenses.
The OLCC highlighted the rapid movement of applications through the system, which is welcome news. Last week, I met with several OLCC officials who outlined their goal of a “zero wait” for change-of-ownership applications, their plans to comply with the new rules requiring polished submissions, and their demands for fast-track applicants.
Oregon’s New Cannabis Rules
Marijuana
The licensing protocol rules mentioned above will go online on January 1, 2026, along with rules that make some technical updates and implement Marijuana Act of 2025. I considered these rules in a recent postand I will not summarize them here.
Earlier this year, rules a ban on the sale of most CBN products also came into effect. i explained:
Beginning July 1, 2025, products containing artificially derived CBN can no longer be sold in Oregon under either the OLCC system or the general (hemp) market unless the manufacturer has determined to be Generally Recognized as Safe (GRAS) or submitted a New Dietary Ingredient Notification to the FDA and received a “no objection” response.
To my knowledge, no one has acquired GRAS status and submitted a corresponding notification to NDI. This is not unexpected, and it is also very bad.
Hemp
Complex hemp registry rules will take effect on January 1. These rules apply to hemp flower pre-rolls, as well as hemp beverages and tinctures that contain cannabinoids such as THC, CBD, and others. The regulations do not apply to hemp products that: a) are sold in stores licensed by the OLCC, b) do not contain cannabinoids, c) are intended for local use only, d) are industrial or commercial feed products, or e) simply pass through the state.
A slew of labeling requirements and “claims” for hemp products sold in Oregon will also go into effect next year. It remains to be seen whether any of these new rules will interact with the recent federal ban on intoxicating hemp products, although I don’t expect much friction. If the federal ban remains, we will likely have fewer out-of-state registrations and fewer products coming in, other than what is allocated to the CBD space.
For what it’s worth, the OLCC and other agencies made public earlier this year report details that most hemp products in Oregon are hot. It wasn’t a great look, but yes was not a surprise.
Oregon Cannabis Litigation
Oregon hemp cases go to court in 2025. Our office has handled a number of business and investor disputes, and there have also been some public skirmishes. Here is my short list:
A friend of the firm, Andrew DeWeese, filed a notable statement challenging the dormant commerce clause to the federal ban on the interstate sale of marijuana. We root for him.
Ballot 119 was defeated in the District Court of Oregon. The measure required most Oregon hemp businesses to enter into labor settlement agreements with approved unions in order to be reinstated or licensed. The unfortunate case is currently pending before the 9th US Circuit Court of Appealsthousand Scheme.
Oregon Court of Appeals ruled against retail applicants unwilling to pay taxes as a condition precedent to license renewal. No appeal was filed.
Cannabis continued to grow rapidly, with Tumalo Industries being the biggest. Market remained soft, buyers again Chasha insiders.
Federal developments
I should add a little bit about President Trump Disposition of December 18, which regulates the transportation of marijuana. We have illuminated him from all sides already, but Oregon cannabis businesses should be happy.
Depending on the path Pam Bondi chooses and the resistance, marijuana could end up on Schedule III in 2026. If that’s the case, many of our customers will get better margins right away. These businesses may also experience less competition from out-of-state hemp operators due to the federal ban mentioned earlier.
Odds and ends
The hemp industry continued to limp along. Finally we saw increase in cultivated areas, despite the declining number of farmers. Licensed “providers” continued to accumulate in the ODA program toward the 2024 enrollment requirement.
We continue to fight to fix and end the cannabis industry transactions structured by brokers. At least one prominent cannabis broker in Oregon has no license, and several others continue to run riot. Of course there are also competent brokers – our advice is never to use legal agreements offered by brokers.
The OLCC appeared to be less strict and returning to compliance training, especially for smaller operators (including laboratories). I would like to think we had something to do this approach and I hope it sticks, but who knows anyway.
The Hemp Alliance of Oregon (CIAO) played a leading role in the 2025 legislative negotiations. CIAO has successfully lobbied for producer transfer rights, expanded trading patterns and more realistic timelines for the CBN compliance regulations mentioned above.
Initiative Petition 39, which aims to legalize cannabis cafes, was filed in February, but withdrawn last month, due to logistical problems.
Emerge Law Group, the Measure 91 law firm and Oregon’s first boutique cannabis law firm, has announced its retirement after a stellar 10-year run. His remaining attorneys to join Denver-based Vicente LLP.
The article was originally published on February 6, 2025
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Many people want to save money during contract negotiations. These people usually do not consult a lawyer for coursework or other initial questions. Sometimes this can work well. For larger and more complex trades, or for trades with a complex opponent, this may not be a good idea. Let’s see why.
What’s the point of a cannabis deal?
A term sheet (also referred to as aletter of intent or LOI) is an outline of the key clauses of the deal that the parties sign before negotiating a final contract. You won’t see them in all deals. They are often used in larger, more complex deals such as M&A or finance transactions. They can be binding contracts, but it’s usually a very bad idea. A non-binding document can be very helpful as the parties will have a roadmap for the deal and work out the key points before proceeding with due diligence and drafting.
Why do people try to file urgent without a lawyer?
Money is the #1 answer. Lawyers don’t work for free, and many people think, “What’s the point of paying your lawyer to draft a non-binding contract?” (I’ll answer this in the next subsection.) Another common concern is strategy. Bringing in the wrong lawyer can just lead to endless stipulation negotiations that can hurt the deal. The purpose of term papers is to get something down on paper quickly, not to go back and forth 20 times. Good lawyers can avoid this problem, but we have seen many cases where this is not the case.
Why people shouldn’t make term papers themselves
A good lawyer who has done a certain deal many times will be able to spot many legal (and even non-legal) problems that many clients may miss. They may also be able to help the customer explain how things are written and defined. All of this can save you a ton of time and money in the long run. By flagging issues at an early stage, the attorney client can take those issues to the other party at an early stage and see if they are palatable. Ourscorporate cannabis lawyerssaw deals fall apart over disagreements over what was on the term sheet.
Another time-consuming point in a deal is when one party wants to add a key term that wasn’t on the list of terms. The other party may refuse to add it on the grounds that it was not in the list of terms, despite the fact that the terms letter was not binding or contained language that expressly stated that the terms letter did not include all material terms of the transaction. This is also another place where deals can easily fall apart. Even if the deal doesn’t fall apart, if the parties disagree about what’s written in the terms and conditions, the costs will skyrocket.
Use a cannabis business lawyer who has experience with term papers
Bringing a bona fide cannabis business lawyer into the drafting process can be key. This is especially true for complex or expensive transactions, or when one party knows they have less leverage in the transaction to request changes later. This is even more true if the other side or their attorneys are tough negotiators. Stay tunedLegal Canna Blogfor more corporate cannabis law updates.
Oregon’s 2026 legislative session began last week on February 2nd. The biennial “short session” will last just 35 days and will focus on budget deficits, transportation and housing — meaning cannabis is not a priority. However, of the approximately 300 bills introduced, there are four items related to cannabis. That’s where I come in.
A link to each bill with an explanation and redaction is below.
This is the annual cannabis bill. My source tells me it fell apart a few weeks ago when marijuana and hemp people couldn’t agree on key points around hemp-based alcohol products or how to implement new federal hemp laws and regulations. This is unfortunate because timing is of the essence in any short session.
For now, HB 4139 has been sent to an ad hoc task force led by the governor’s office and the Cannabis Industry Association of Oregon (CIAO). They met yesterday, apparently, at 1 p.m.
Here’s what the bill would do as introduced, with a few of my comments:
The definition of “adult-use cannabis” is changing. (But only in connection with the above.)
Imposes a 17% retail tax on industrial hemp-derived cannabinoids. This is the same percentage charged on the sale of marijuana products in the Oregon Liquor and Cannabis Commission (OLCC) system. There is no provision in the bill for the 3% surcharge that normally applies to OLCC sales.
Orders the OLCC to immediately suspend the marijuana grower’s license for the reasons specified. The language includes a “probable cause” standard that appears potentially problematic from a due process perspective. This section also provides that an OLCC manufacturer’s license suspended under this subsection “shall not be transferable pending final resolution of the commission’s action relating to the suspension,” and it prohibits the OLCC from issuing a new license on the premises for 10 years.
Orders the OLCC to conduct an unannounced inspection of the commission-licensed premises for the reasons specified and request that law enforcement escort the OLCC to the premises. It is also tied to the probable cause standard. It feels less risky if we’re just talking about validation. (“Inspect” is defined, euphemistically, as “to examine or inspect formally.”)
The Oregon Department of Agriculture (ODA) is required to complete a criminal record check on the applicant for an industrial hemp license. Excellent. As with OLCC licensees.
An applicant for a license to grow industrial hemp is required to submit to the department a statement of land use compatibility and information related to the ownership of the land. Excellent. As with OLCC licensees.
Directs the ODA to conduct unannounced inspections of licensed premises for specified reasons and request a law enforcement escort to the premises. See comment above re: OLCC Licensee Inspections.
This is a medical marijuana bill aimed at patients and caregivers. I was told that it has traction and a working meeting tomorrow. Here are the main provisions:
Expands the definition of “debilitating medical condition” for the medical use of marijuana to include “the need for hospice, palliative care, comfort care, or other symptomatic treatment, including pain relief.” It feels like an uncontroversial cleanup job.
Requires an organization or residential facility designated as an additional guardian for a medical marijuana cardholder to establish and maintain a written policy and provide educational training for certain personnel regarding the medical use of marijuana. Excellent.
Exempts hospitals and hospital-affiliated clinics from the requirements. I’m pretty sure it has to do with federal law and insurance issues.
Protects an organization or residential facility, its employees and contractors from certain criminal liability related to the medical use of marijuana. Long overdue.
Prohibits the Oregon Board of Nursing from disciplining a nurse for discussing the medical use of marijuana with a patient. Long overdue.
This stupid bill was introduced by the United Food and Commercial Workers Local 555, which is trying to get its own initiative overturned. My guess is that the UFCW is doing this because the US District Court ruled that the initiated law is unconstitutional, as predicted, and they don’t want “more bad law” if the Ninth Circuit upholds that decision.
I’ve written extensively about the waste of taxpayer money that the Ballot Measure 119 saga represents. See here, here, here, here, here, here, here, here and here. In short, BM 119 required most Oregon cannabis businesses to enter into labor peace agreements with “approved unions” in order to renew or obtain a license. May 20thousandDistrict Court of Oregon beat him. The case is pending appeal, but HB 4162 could quietly debate it if passed.
Basically, HB 4162 is the equivalent of the Union saying, “Hey, Legislature, please repeal this law, which you warned would be legally flawed, but which we convinced the voters to approve directly regardless. We’ll stop wasting taxpayer money if you help us repeal ourselves. (At least for now.)”
This is a public health and prevention bill introduced by the chairman of the Senate Conduct Committee. I’m told Monday’s hearing was contentious between that side of the aisle and the industry. Here are the main provisions:
It requires individual packaging of cannabinoid food products and allows for up to 10 milligrams of adult cannabinoids per cannabinoid food product. The industry’s argument here is the packaging requirements for cannabis create huge wasteand are an affront to sustainable development. This is a good argument.
It requires cannabinoid-containing foods and other cannabinoid-containing products to be packaged in a manner that “reasonably” meets the specific purpose of protecting minors from the adverse health effects of the “illegal use” of cannabinoid-containing foods and other cannabinoid-containing products. See comment above.
Allows local governments to create buffer zones more than 1,000 feet wide around adult medical cannabis and marijuana in the interest of public health and safety. The Legislature has been working for years on the buffer zone, on grandfathering concepts and all that. There is no compelling health or safety reason for local authorities to reduce the accommodation radius; it should be left alone.
Let’s wrap it up for now
I’ll be back at the end of the session and let you know what happened, if anything. Aside from the farcical HB 4162, whatever passes will likely look markedly different in its final form than the registered drafts we see today. Stay tuned.
