As the coronavirus rages on, few industries have experienced as many highs and lows as California’s cannabis industry, reports the Washington Post. A month ago, it looked like California’s weed trade was headed for a shutdown, which would have landed a devastating blow to many businesses that are struggling. Then, state officials deemed pot “essential,” and many stores reported the biggest sales since recreational marijuana became legal. Now, a more sobering reality is setting in: The marijuana industry is unable to tap into a federal stimulus package or bank loans. “There’s no money that’s going to be coming into the sector,” says Nicholas Kovacevich of KushCo Holdings, a major distributor to marijuana dispensaries. “All of these companies, including us, need to get profitable really quickly or risk running out of money.”
For industries like California’s pot business that were already on the brink, the coronavirus crisis is a make-or-break moment. Many retailers and restaurants have shut for the stay-at-home order, unsure whether they’ll reopen when it’s over. For the pot business, the lack of a safety net, access to banking or the ability to tap into federal stimulus dollars means the tiniest misstep could lead to bankruptcy. “The fact that they’re allowed to be open is huge,” said Fiona Ma, the California state treasurer who said she hopes marijuana will help buoy the state’s tax revenue, which is sure to be drastically down this year. “Obviously, it’s going to help,” she said. She cautioned that the illicit marijuana business is likely also bustling, with even less enforcement because of stay-at-home orders.