Recreational cannabis retail sales continued to climb steadily this year, to more than $1.2 billion, roughly an 85% increase from 2020 through November of this year alone. The medical cannabis program reached 136,000 active patients, who spent another $362 million. The sales generated more than $300 million in tax revenue in fiscal year 2021 — more than from alcohol.

But after new applicants waited through more than a year of delays for business licenses, judges prevented them from opening dispensaries while litigation dragged on, with no solution in sight.

The year saw many new twists in the cannabis field. Sales took off for hemp-derived Delta-8 THC, called “weed light,” despite existing in a legal gray area. Huge multistate companies gobbled up independent dispensaries and expanded dramatically. In one constant, prices of marijuana in Illinois remained among the highest in the nation.

While cannabis remains illegal under federal law, proposals to decriminalize it or let banks finance it have been slowly gaining some support among lawmakers. The year also ushered in a vast array of new products and consumer trends. Here are a few reasons why 2021 was a great year for big cannabis operators in Illinois, but frustrating for newcomers.

Consolidation

Several cannabis companies founded and headquartered in Chicago have become among the largest operators in the nation, while out-of-state operators have come into Illinois, by opening new facilities or buying up competitors. Cresco Labs and Curaleaf each have grown to the maximum 10 retail sites in Illinois; PharmaCann has eight; Ascend Wellness, seven; Green Thumb Industries lists nine stores on its website; nuEra has six, and Zen Leaf operates 10.

Together, that means seven companies control 60 of the 110 weed stores in the state.

The number of growers is even more limited. A mere 18 companies are allowed to grow cannabis — compared with hundreds of companies that do so in Western states like Oregon or California, where they have the opposite problem of oversupply to the illegal market.

Licensed growers in Illinois say they support new entrants to the market by helping with the complicated application process, by paying hundreds of thousands of dollars each in state fees to help fund startups and for seed projects to help them get started. PharmaCann promised $600,000 to help fund scholarships and build Oakton Community College’s new cannabis cultivation laboratory. Cresco Labs created its new Illinois Cannabis Education Center in Chicago, which offers a mock dispensary and training facility for aspiring workers and owners.

By state law, there was supposed to be a slew of new businesses licensed last year, with favoritism toward poor, largely minority areas with high rates of cannabis arrests. But after a series of delays, applicants complained that consultant KPMG had scored applications unfairly, resulting in wealthy, white, politically connected winners.

To address the complaints and associated lawsuits, state lawmakers authorized 185 new dispensary licenses. But Cook County Judge Moshe Jacobius ordered that those licenses not be awarded while he wades through lawsuits challenging the process.

The state did award 40 new craft grower licenses plus infuser and transporter licenses, but Cook County Judge Neil Cohen forbade the issuance of up to 60 new craft grower licenses due this year, while the courts try to resolve litigation from applicants who were disqualified.

None of this slowed down the existing market. Companies that had been granted licenses to open medical marijuana dispensaries since 2015 were allowed to also sell recreational weed, and to expand to second locations. Because of its artificially constrained market, Illinois still has among the highest-priced weed in the country.

Wholesale flower prices reached nearly $4,000 per pound, analyst Cantor Fitzgerald & Co. estimated — three times the U.S. average pegged by price tracking company Cannabis Benchmarks. With customers paying $19 per gram for retail flower, Cantor Fitzgerald estimated average annual sales per store at nearly $17 million.

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Moldy weed worries

A big part of the demand — $1 out of every $3 spent — is from out of state, since Illinois is surrounded by states that don’t allow recreational sales. Michigan does have adult use sales, but was hit by a large public recall of cannabis that had high levels of mold or other contaminants, with stores required to post notices alerting customers for a month after sales.

Illinois, in contrast, issued a recall and quarantine this year, but kept it quiet. In May, the state Department of Financial and Professional Regulation sent dispensaries notice of a voluntary recall of Verano’s Mag Landrace flower due to possible mold contamination. The department investigated the issue, but said it is prohibited by the state cannabis law from disclosing the results.

In addition, a former production supervisor for PharmaCann, William Sanford, filed suit claiming that he was fired for repeatedly reporting moldy cannabis for removal after it had passed lab tests. The tests only sample a small part of each crop, so mold may grow undetected and may sicken those who eat it or inhale its spores. Sanford said he was told to stop reporting mold, but continued to do so, and was terminated in July.

PharmaCann acknowledged that mold is a factor with any agricultural product, but is tightly controlled. By state law, all legal cannabis products must undergo lab tests to pass strict state limits on mold, pesticides, metals and other contaminants. If they fail, they may be treated with solvents for use in edibles, vapes and other products, but must be tested again to meet safety requirements. Options for sterilizing cannabis include irradiation or ozone gas, as used in the food industry.

Microdosing

Customers may have noticed a dizzying variety of new products this year. One growing trend was in the area of low-dose edibles, for consumers to better control their experience. Rather than the 10 milligrams of THC, the main component that gets users high, which was previously suggested as a serving size, mints and gummies now often contain 5 or 3 mg, often with matching cannabidiol, or CBD, for users who want to relax without getting too high or paranoid.

One study by researchers at the University of Illinois at Chicago and the University of Chicago found that low levels of THC reduced stress, while slightly higher doses that produced a mild high actually increased anxiety.

And a survey by BDS Analytics Report found that 43% of edibles customers prefer low-dose products, and half of customers chose products based on the amount of CBD, which is thought to have a moderating effect on THC.

Beverages are also growing in popularity, offering moderate doses of THC and the quick onset of effects without the smoke. For hardcore users, there are still plenty of high-powered flower, vapes and concentrates approaching 90% THC.

For those who don’t like the high prices and taxes of licensed weed, this year saw the rise of Delta-8 THC. It’s typically said to be derived from hemp, and provides similar, if milder, effects as the traditional Delta-9 THC found in pot. It’s often sold in gas stations or vape shops. A proposal to outlaw such knockoff cannabinoids did not pass in Springfield this year, but may be reconsidered in the spring session.

Cannabis suppliers continue to compete for customers through word-of-mouth and the occasional competition. Most recently, the High Times Cannabis Cup named its winners for 2021, as judged by public participants.

Wait till next year

Looking ahead to 2022, state Rep. La Shawn Ford, a Chicago Democrat, has proposed legislation to expand the new craft growers licenses from 5,000 square feet to 14,000 square feet or more. That would still be a far cry from the 210,000 square feet of canopy that existing growers are allowed, but would help business owners get more financing based on their ability to produce more revenue.

Also, in light of the courts’ de facto lockout of new minority owners, a group called Ex-Cons for Community & Social Change held protests this year, calling for consumers to support their “local weed man,” or illegal dealers.

Found Tyrone Muhammad of Englewood, who served 21 years in prison for murder and now says he’s trying to rebuild his community, called for creation of a peddler’s license, so people without the money to open a bricks-and-mortar facility can take part in the cannabis industry. He believes licensing would reduce the violence that accompanies illegal drug dealing.

Muhammad is also pushing to change state law to drop the ban on former felons working in the field. As it stands, only those with low-level convictions can get expungements and get licensed.

“It’s still a farce,” he said. “In any other industry, as an ex-con, I can work. But I can’t work in the cannabis space.”