California cannabis cultivators are struggling with wholesale price depression from oversupply, outsized competition from the illicit cannabis market, and now losses from wildfires driven by climate change. Many cannabis farmers are surrendering cultivation licenses amid a 12% decline in the total value of all California cannabis products sold from $6 billion (in 2021) to $5.3 billion (in 2023). Against this backdrop AB 1111, which passed the Assembly last year, seeks to open up a state pathway for small producers to make direct-to-consumer sales, under certain restrictions. AB 1111 would require the Department of Cannabis Control to issue, by January 1, 2026, small producer event sales licenses to licensees meeting specified requirements, that authorize the license holder to sell cannabis or cannabis products, containing cannabis cultivated by that licensee, at state temporary events licensed under the act. While there are doubts about how much AB 1111 would really help small cannabis farmers, given the magnitude of the challenges they confront, this legislation would represent an expansion, albeit a limited one, of access to cannabis in California. With local jurisdictions like the City of Sacramento recently restricting cannabis retail, and 54% of California cities and counties continuing to ban all commercial cannabis, AB 1111 would go in a different direction and create a state-level channel for California consumers to access cannabis directly from small farmers. To survive this legislative session and be sent to Governor Newsom’s desk, AB 1111 must receive a two-thirds vote in favor of passage on the Senate floor by August 31.
