California Governor Gavin Newsom says the state is “doubling down” on its commitment to protect residents from unlicensed and unregulated cannabis products.
In an update published last week, Governor Newsom said officials have seized more than $316 million worth of illegal cannabis and $474,000 in cash since the beginning of this year; adding to $534 million worth of illegal cannabis seized in 2024. Officials have confiscated 212,681 illicit cannabis plants, and issued 99 warrants that resulted in the removal of 35 firearms and 29 arrests since January.
“As California’s legal cannabis market expands, we have a responsibility to crack down on the nefarious actors that put public health at risk and undermine the progress we’ve made,” said Governor Newsom. “Unlicensed, unregulated products threaten consumer safety and jeopardize the integrity of this industry.”
Through more than 1,500 operations, officials have seized and destroyed over 800 tons of illegal cannabis with an estimated retail value of $3.1 billion since 2019.
A cannabis task force was established in 2022 by the governor to strengthen collaboration and enforcement coordination between California’s state, local, and federal partners. Then in September last year Governor Newsom announced emergency hemp regulations tackling intoxicating hemp food and beverage products that were widely available in the state. Last month, the Governor announced those emergency regulations would be renewed.
Since the emergency hemp regulations were implemented, California’s Alcoholic Beverage Control agents have inspected 9,251 locations and seized 7,007 hemp products from 141 violators.
While conditions for licensed cannabis businesses in California have been challenging since 2021, the market remains the largest in the United States. Although difficult to estimate, a report prepared by ERA Economics, LLC for California’s Department of Cannabis Control released in January this year states an average of 11.4 million pounds of unlicensed cannabis (dry flower equivalent) is produced in California each year.
While the total value of retail sales in the licensed market was down in 2024, the total volume of retail sales for nearly all product categories was up; indicating the decrease in the total dollar amount was driven by lower prices. One of the factors contributing to lower prices is the illicit market.
The report stated the share of total consumption supplied by the licensed market continues to be stable at about 40 percent – so there’s still plenty of work to be done in reining in the illicit market.
