No Joy in Budville

Tariff tantrum tanks the tape.

Daily Recap

The economic strategy of President Trump’s global tariffs has left almost every US industry scratching their heads as they attempt to plan for their future.

Given the US cannabis industry is a closed market, meaning almost all US cannabis must be grown in the country and cannot even be traded across state lines, it could be one of the most protected sectors following yesterday’s sweeping announcements.

However, cost increases of things like equipment and packaging, the latter of which is largely imported from Asia, could peel away at already razor-thin margins as the U.S. industry is already being treated like second-class American citizens.

Progress Report

Four years after New York legalized adult-use cannabis and two calendar years after regulated sales began, there have been significant signs of improvement despite what has been, by all accounts, an extremely flawed roll-out. Among them:

• Retailers on pace to sell as much as $1.5B in 2025 after eclipsing $1B in 2024.

• 343 retailers are open as of April 2, up from 260 in Dec. 2024.

• A statewide crackdown on unlicensed operators has largely worked.

• A previously understaffed OCM now has 230 employees, up from 170.

• Taxes paid by regulated operators are funding $5M in grants to youth-serving nonprofits in impacted communities.

Younkin Donuts

Virginia lawmakers rejected Gov. Glenn Youngkin’s (R) proposed changes to a medical marijuana bill already passed by the legislature, sending the measure back to his desk.

In a separate vote, they adopted the proposed amendments to another bill that would seal records of past cannabis crimes—but the legislature upheld Youngkin’s vetoes of legislation to legalize adult-use cannabis sales, provide resentencing relief to people with cannabis convictions and protect the parental rights of consumers.

Alabama Slammer

Despite considerable opposition from a segment of the Alabama business community, several state lawmakers have pushed forward with efforts to impose strict regulations on psychoactive cannabinoid products such as delta-8 and THC-infused drinks.

Rep. Andy Whitt (R) filed House Bill 445, which would impose strict regulations on all consumable hemp products, like how alcohol is regulated.

“In 2023, the Alabama Poison Information Center investigated 235 cases involving delta-8, and more than 40% of calls were for children six and under,”

Stocks & Stuff

It was a red mess on Wall Street after the newly announced tariffs created uncertainty around future investment conditions and sparked concerns of stagflation, a recession, or worse.

Cannabis stocks weren’t immune on either side of the border, with U.S. cannabis ETF falling 8% and registering a fresh all-time low.

Below, we’ll talk through the tariffs and explore implications for U.S.-based cannabis operators, talk through the MSO share dilution dilemma, keep an eye on Canada as prices quietly firm, and offer some profound perspective on an otherwise dank day.

All that and more, just scroll down.

note: there will be no Cannabis Confidential tomorrow.

SPY 0.00%↑ QQQ 0.00%↑ IWM 0.00%↑ MSOS 0.00%↑ ETF Notional: $14M

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