Hurricane Milton's Aftermath: The Financial Toll on Florida's Cannabis Industry

As Florida continues to recover from the havoc wreaked by Hurricane Milton, the state's rapidly growing cannabis industry has been hit hard, facing significant disruptions in operations and revenue. With stores shut down, delivery services halted, and cultivation facilities damaged, cannabis businesses are grappling with the consequences of the storm, not only in terms of repair costs but also in lost sales and production downtime.

Business Shutdowns: Safety First, Revenue Second

In the days leading up to Hurricane Milton's landfall, cannabis companies across the state scrambled to prepare for the storm. Many opted to shut down operations to safeguard their employees and patients, with Florida’s largest multi-state operators (MSOs) such as Cresco Labs, Trulieve, Ayr Wellness, and Verano closing the majority of their dispensaries and pausing delivery services.

Cresco Labs, for instance, temporarily shuttered nine of its Sunnyside dispensaries, with the company stating it would only reopen when the safety of both staff and customers could be assured. Similarly, Trulieve, which operates 80 stores in Florida, preemptively closed more than half of them and paused deliveries, advising patients to stock up on cannabis products before the storm.

While these measures were necessary to prioritize safety, the closures came with a heavy price. The Florida cannabis market, projected to generate over $2 billion in 2024, faces a significant dent in its revenue as stores remained closed for multiple days, and deliveries were canceled in some areas. The interruption in services has created ripples across the entire cannabis ecosystem, from growers to patients.

Impact on Cultivation and Supply Chains

The cultivation sector wasn’t spared from Hurricane Milton's wrath. Cresco Labs shut down its cultivation facility in Indiantown, citing concerns for the safety of its workers and the need to allow them to prepare their homes for the storm. Ayr Wellness, another key player, closed its grow facilities entirely while keeping skeleton crews and generators on standby to monitor plant health and maintain basic operations.

These closures not only led to downtime in production but could also result in long-term impacts on the supply chain. Cannabis is a delicate crop, sensitive to environmental stressors like heat, humidity, and waterlogging — conditions exacerbated by hurricanes. Ayr Wellness installed environmental sensors to monitor plant health, but other smaller operators may lack such resources. This disruption in cultivation could lead to delayed harvests, reduced yields, and a potential shortage of cannabis products in the coming months, driving up prices and limiting availability.

Financial Strain: Costs Beyond the Storm

The immediate closures and lost sales are just one part of the equation. The financial toll on Florida’s cannabis businesses is set to grow as companies assess damages and begin repair efforts. As of now, damage assessments are still underway, but early reports indicate that facilities sustained wind and water damage. Installing storm-proof infrastructure, from boarding up windows to reinforcing cultivation facilities, comes with hefty costs, and recovery expenses could strain smaller businesses already operating on thin margins.

Trulieve, Cresco, and other operators have also invested in disaster preparedness infrastructure, such as generators and reinforced structures, but these investments come at a significant cost. Beyond repairs, power outages affected millions of Florida residents, adding another layer of operational difficulty for cannabis facilities that rely on stable electricity for plant growth, climate control, and security systems.

Moreover, with Hurricane Helene having hit just two weeks earlier, businesses are now dealing with a compounding effect, as some areas hadn’t fully recovered from previous damages. For operators located in areas like Sarasota County, which experienced a storm surge of 8-10 feet, back-to-back storms have worsened an already challenging recovery process.

Looking Ahead: Industry Resilience Amid Disaster

Despite the financial and operational challenges, Florida’s cannabis industry is showing resilience. With emergency protocols in place, companies like Verano Holdings have implemented proactive measures to protect their employees and businesses from further damage. This includes keeping facilities staffed with skeleton crews, activating generators, and adhering to guidance from local emergency management officials.

The aftermath of Hurricane Milton also underscores the importance of robust disaster preparedness plans in an industry vulnerable to environmental disruptions. MSOs with stronger infrastructure and resources may be better positioned to recover quickly, but smaller operators could struggle to bounce back without financial assistance or disaster relief.

In the broader context, the hurricane’s impact on the cannabis supply chain will likely lead to increased discussions on business continuity planning, as well as calls for policy changes that might offer cannabis businesses access to federal disaster relief funds. Currently, due to the plant’s federal illegality, cannabis companies are excluded from many federal relief programs, a situation that could hamper the industry's recovery efforts in the wake of natural disasters like Hurricane Milton.

Conclusion: The Financial Aftermath of Hurricane Milton

Hurricane Milton has left behind a trail of destruction that extends far beyond downed power lines and damaged buildings. For Florida’s cannabis industry, the storm has created significant financial strain, from revenue losses due to business closures to costly repairs and supply chain disruptions. While the resilience of operators and emergency planning will help the industry recover, the economic impact of this and future storms could challenge the sector's growth.

As climate change continues to fuel stronger and more frequent storms, Florida’s cannabis industry must adapt to a future where disaster preparedness is not just an option, but a necessity for survival.