Building the Empire: A New York Pre Roll Market Overview
Posted by Custom Cones USA on Sep 6th 2024
Long considered the sleeping giant of the industry, New York’s pre roll market is finally slowly lumbering awake, and it has all the makings of a monster.
Following a slower-than-expected rollout and continuing delays and challenges for businesses seeking licenses, the New York market has been slow to get up to speed, but with the third-highest population among the states, but the pre roll is already the best selling product form in the state and there is a seemingly endless array of possibilities and promise for pre-roll producers in the years ahead.
However, the Empire State has some unique regulations around testing and packaging that are important for any pre-roll producer looking to break into this fast-growing marketplace. So let’s dive into the current numbers, take a look at the potential and review the testing and packaging regulations facing pre-roll makers in the New York cannabis industry.
*All pre roll data was pulled from cannabis analytics firm Headset.io, which is sourced from consumer transactions in 13 states, including New York.
TABLE OF CONTENTS
The New York Pre-Roll Numbers
With 165 adult-use dispensaries open by the end of August, New York’s cannabis sales totals reached $100 million in the first quarter of 2024, $160 million in the second quarter and are on pace to surpass that in the third, according to statements from the Office of Cannabis Management’s policy director.
Growth in New York’s pre roll sector is just as impressive, if not more so.
Through the first seven months of 2024, more than 2.5 million pre-rolls have been sold for a total of nearly $60 million. That’s enough to make pre-rolls the top-selling category this year in terms of units sold and No.3 in revenue, behind only flower and vape pens.
Pre rolls sales set a record in June, notching more than $14.4 million in total revenue and reaching a record-high market share of 19.5 percent in both June and July, up from just $5 million in sales and a 15.1% market share in January 2024.
That’s a 187.5% increase in pre roll revenue over the first six months of this year.
In total, nearly 8.8 million pre-rolls have been sold for more than $331.6 million in revenue since Headset began tracking sales data in June 2023.
New York’s average pre-roll price remains high, however, which is normal for newer markets. So far this year, the average item price is $23.60, which remains among the highest in the nation, though as we’ll see in a minute, that is mostly due to the popularity of the multi-pack among New York consumers. However, even that number is slowly dropping as the year goes on, reaching a low of $22.82 in July, down from $25.89 in January.
Prices are also continuing to drop on per-gram equalized average as well.
After peaking at a per-gram average of $15.22 in August 2023, prices have only fallen to an average of $14.23 by July 2024. However, over the same time, the cost to dispensaries – or the amount that producers are getting for their pre-rolls – has also remained relatively consistent, falling from $7.70 to $7.07 over the same period, making the pre roll a popular and profitable option for producer/processors in the Empire State.
Top New York Pre Roll Products
Still a young market by all accounts, the top two segments of New York’s pre-roll market this year has been the connoisseur/infused and Hybrid – single strain segments. In January, the infused segment, which features a concentrate mixed in with the flower and therefore requires enough base production to warrant both the making of concentrates and their use as a supplement in pre-rolls, surpassed single strain hybrids to become the top segment, only to see single strains regain the top spot in June.
Both have seen incredible growth, however, spiking their best sales in June as more and more dispensaries open their doors. However we do expect that as the market matures further and the availability of concentrates continues to increase, bringing the price down, that the infused segment will once again rise to the top.
Another common trend we see playing out in the New York data is the rise of multi-pack packaging for pre-rolls. So far in 2024, for example, the top 17 pre-roll products sold in the state – and 18 of the top 20 – are multipacks.
However it is important to note that package size generating the most sales is the 1-gram size, selling 1.6 million units for a total of $23 million. The 2.5 gram size comes in second with 530,000 units sold for a total of $21.8 million in sales.
The top selling pre roll products in New York State in 2024 are:
- Ruby Farms – Doobies – White Widow Pre Roll 7-Pack (3.5g)
- Ruby Farms – Classics – Granddaddy Purple Pre Roll 7-Pack (3.5g)
- Ruby Farms – Doobies – Black Cherry Gelato Pre Roll 7-Pack (3.5g)
- Florist Farms – Candy Jack Infused Pre Roll 5-pack (2.5g)
- Florist Farms – Dutch Hawaiian Infused Pre Roll 5-Pack (2.5g)
Among brands, it’s no surprise given their position in not only the top 3 sales spots, but in 6 of the top 10 positions that Ruby Farms has been the best-selling pre roll brand in the state each month this year. In July alone, Ruby Farms racked up $2.5 million in sales, nearly three times that of second-place finisher Jetpacks (about $818,000).
Rounding out the Top 5 pre-roll brands in July are Florist Farms ($698,000), Dank. By Definition ($642,000) and Nanticoke ($641,000).
New York Pre Roll Testing Requirements
New York’s testing regulations are similar to most other state industries, but because they have had the opportunity of seeing several markets open before them, they are slightly expanded, particularly in heavy metals testing.
New York also requires all testing to be done in the product’s “final form,” including pre-rolls. According to the law, “the entire pre-roll or a portion of it (depending on size (blunt, 0.5-g, 1-g)) must be prepped and tested for all contaminants of concern,” which means that the paper you use to pack your pre rolls will also be tested.
New York requires testing of products in the “final form” for the following:
- Moisture Content and water activity;
- Residual solvents and processing chemicals;
- Residual pesticides;
- Microbial impurities;
- Mycotoxins;
- Foreign materials;
- Eight different heavy metals;
- Cannabinoids; and
- Terpenes.
At Custom Cones USA, all of our pre rolled cones, pre rolled tubes and pre rolled blunt cones are laboratory tested for heavy metals, pesticides and microbials – and we have the COAs on hand if you need them – so you can be sure your rolling paper will never be the reason you fail a test.
We’re also willing to send out samples for you to pack with your flower and have tested, so you can be 100% sure.
Heavy Metals Testing for New York Pre Rolls
Plants absorb heavy metals from the soil, but they can damage all the body’s vital systems, including respiratory, central nervous and even the reproductive system, which is why cannabis is tested to ensure it is free of these metals.
While New York tests for the “Big Four” heavy metals - mercury, cadmium, lead and arsenic (all of which are toxic even at small doses) - it is also one of a handful of states that also add chromium, which can damage the kidneys and liver.
But the Empire State goes even a step farther, requiring additional testing for copper, nickel and antimony as well.
Microbial and Mycotoxin Testing for New York Pre Rolls.
Among the substances tested, microbes and mycotoxins pose the most significant risk to human health.
The dangers of microbial contamination are widely recognized, which is why New York's testing regime includes checks for Salmonella, E. coli, and several Aspergillus mold species (A. fumigatus, A. flavus, A. niger, and A. terreus).
Mycotoxins, toxic compounds produced by molds such as Aspergillus, can weaken the immune system and harm the liver. New York mandates testing for two mycotoxin categories: Aflatoxins and Ochratoxin A. These substances have the potential to modify DNA, possibly leading to the development of cancer cells. Mycotoxin screening is crucial to ensure the safety of cannabis products for consumption.
In New York, the maximum allowable limit for all mycotoxins is set at 0.02 micrograms per gram.
Pesticide Testing in New York Pre Rolls
Like most states, New York limits the pesticides that cannabis growers may use. To help producers determine if a pesticide can be used on cannabis, the state’s Department of Environmental Conservation even added “cannabis” and “hemp” to the use/type drop down menu in its pesticide database.
Additionally, New York law requires labs to specifically test for 70 different pesticides, providing actionable limits.
Packaging Requirements for New York Pre Rolls
Like every market, New York also has a unique set of regulations regarding packaging for pre-roll products, including one requirement that sets it apart from almost every other state.
In New York state, all cannabis packaging, including pre roll packaging, has to be child resistant and tamper evident. However, while general cannabis packaging must also prevent light degradation of the product, because the rolling papers prevent light from directly affecting the product, pre-roll packaging does not necessarily have to be opaque.
Any packaging, including pre-rolls must also be designed so as not to appeal to minors. That means it may not resemble a common product or use words like “candy” (or spelling variations of it). New York also specifically disallows colors that are “neon” in appearance, including any color that has a saturation value of greater than 60%.
But New York goes even further in its packaging regulations, requiring any plastic packaging to be made of at least 25% post-consumer recycled material, such as our eco-line pre roll tubes.
Final Thoughts on New York Pre Rolls
Despite some complicated regulations (particularly around packaging), additional testing requirements and continuing bureaucratic complications that have slowed the state’s licensing and rollout, the New York State cannabis market is nonetheless off to a strong start, particularly for makers of pre rolls.
Prices remain high compared to other states, but sales have been robust and the pre-roll is now the top-selling item in the Empire State. Producers and consumers alike continue to flock to the product for its price point, profitability, ease of use and seemingly endless capacity for innovation.
We expect infused sales to regain the top spot in New York as the market matures and more flower becomes available to be turned into concentrates and the dominance of the multi-pack to continue.
With a bright future ahead of it, now is the time for pre-roll manufacturers and producers to take advantage of a slow rollout to lock in the additional testing requirements and stock up on the post-consumer recycling plastic necessary to compete and establish a foothold in what promises to be one of the largest and most important pre-roll markets in the country.
But remember, in the Empire State, pre rolls are tested in their final form, so be sure your rolling papers and pre rolled cones have also been tested!
Contact the Pre-Roll Experts today to find out how can help take you and your pre roll brand to the next level!
Long considered the sleeping giant of the industry, New York’s pre roll market is finally slowly lumbering awake, and it has all the makings of a monster.