There are always “bumps in the road” with the rolling out of any new industry, but New Mexico’s cannabis industry excites those in and around it.
Those are the words of cannabis leaders across New Mexico, some of whom presented their hopes, fears and challenges of the recreational cannabis industry at the Economic Forum of Albuquerque on Wednesday.
Presenters at the forum included Everest Cannabis Co. CEO Trishelle Kirk, Sen. Katy Duhigg, Azuca CEO Kim Sanchez Rael and moderator Eric Speegle, president of the Verdes Foundation.
“My hope is that we … in New Mexico and in the entire country, reeducate ourselves and are able to bring the true healing and medical benefits of this plant to the human population in a safe and regulated way,” Rael said.
The good and the bad
Recreational cannabis has been legalized for sale since April 1. So far, the industry has realized more than $40 million in revenue – and more than $80 million when combined with medical cannabis sales in that same time period.
But this new industry has come with some fears, spanning across federal and state regulations and competition with the illicit market.
One of those fears, Duhigg said, is that businesses that entered New Mexico’s cannabis industry with the passing of the Cannabis Regulation Act may not know what they’re getting into – spending their savings on creating a business out of every monetary asset they have.
And that can be especially troublesome because businesses in the cannabis space can’t declare bankruptcy being that cannabis is still considered federally illegal.
“My greatest worry is that a whole lot of people are going to lose their shirts on this,” said Duhigg, a Democrat who was involved in the drafting of the Cannabis Regulation Act and an attorney who specializes in cannabis law. “There’s a lot of people who have a little bit of savings and think they are going to be millionaires – and they are they are not.”
Kirk echoed Duhigg’s sentiments and said she is also concerned about the complex regulations, from packaging and labeling to zoning and testing requirements.
Kirk’s other concerns include the amount of licenses being approved, the conundrum with cannabis taxes and how both can lead to a healthy black market – which can prove to be a major competitor to legalized cannabis.
“(A) theory I have is that we end up with a bigger black market than a legal market, and that’s based on what we’ve seen in some other markets where there are either too many licenses or people are desperate, and, you know, they’re just trying to figure out a way to get the tax bill paid or whatever it is,” Kirk said. “A lot of times that can revert into a bigger and more sophisticated black market.”
Kirk said career-wise, the industry is typically more open for growth for employees who may not have a higher education degree, as her company only has about 10% of jobs that require that.
About 85% of her employees, too, are under the age of 35 with many eyeing the industry as a career and not a job.
“They are smart and they are driven, and they don’t look at cannabis as a job,” Kirk said. “They look at it as a career. And people who have careers want to invest in their communities and they want to stay in New Mexico. And that’s what I want to see more of.”
A growing industry
Recreational cannabis is an industry that is expected to continue to grow. Rael said the industry, in fact, “right now is projected to be at 20% category growth over the next five to seven years.”
That has held true for companies such as Everest, which employ around 160 people across all operations. Since June 2021, the company has hired 70 employees, or about an 80% increase.
But the growth is not limited to just retail, production and manufacturing. It extends out to other companies entering the cannabis space such as Terra Vera, a company that specializes in agriculture technology that wants to help increase yields and healthier plants, Rael said.
“We are in a great place in New Mexico to leverage our innovation platforms to support this really rapidly growing global industry,” Rael said.
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