michigan weed prices

Michigan marijuana sales, prices spike as recreational market takes hold

Several jars of cannabis flower on display inside Lake Effect medical marijuana provision center in Portage, Mich. on Sept. 5, 2018. Joel Bissell | Joel Bissell |

LANSING, MI — While Michigan marijuana sales, customer prices and the number of licensed businesses rise, the total number of medical patients and caregivers are in a slight decline.

The state Marijuana Regulatory Agency, which oversees the state’s marijuana industry, recently released statistical reports analyzing licensing costs, sales, retail prices and patient and caregiver registration activity related to both the medical and recreational marijuana markets.

  • December marijuana report
  • Fiscal year 2019 medical marijuana licensing report
  • Statistical report, July 1 through Sept. 30

The state has begun releasing monthly reports that include sales, cost and other data for the medical and recreational markets. The report for January is expected later this week.

Below are some takeaways from the available reports that encompass data collected between Oct. 1, 2018 and Jan. 21.

The state recorded $2.6 million in recreational marijuana sales between Jan. 13 and Jan. 19, the highest weekly total since the first recreational stores opened Dec. 1.

As of Jan. 19, recreational marijuana retailers have made $12.7 million in sales, which represents $2.1 million in combined sales and excise taxes to the state.

A total of $31.9 million in marijuana sales –$24.9 million in medical and $7 million in recreational — were logged in December.

Medical marijuana dispensaries sold $219 million worth of marijuana and marijuana products, including 33,646 pounds of flower from 58,620 harvested plants, during fiscal year 2019, which ran from Oct. 1. 2018 to Sept. 30, 2019.

The pace of sales is on the rise. Quarterly medical marijuana sales during the first quarter of 2019 were $17.6 million, compared to $91.8 million in sales during the final quarter.

The bulk of all sales during the fiscal year came from Marijuana flower, $106.1 million, nearly 48% of all sales, and concentrates, which include vaping products, representing $87.7 million or 40% of total sales.

The price of marijuana flower increased nearly 33% over the fiscal year, jumping from an average of $174.15 per ounce through the first two quarters to $232.18 per ounce in quarter four. The prices continue to climb with new supply and demand from the recreational market.

The average price per ounce of marijuana flower in the month of December was $306.21 for medical and $507.30 per ounce for recreational marijuana.

Licensing activity, revenue and costs:

The Medical Marijuana Licensing Board, abolished by Gov. Gretchen Whitmer in April and replaced with the Marijuana Regulatory Agency, issued licenses to 111 of 525-plus applicants between October 2018 and April 2019.

As of December 31, there were 377 medical marijuana business licenses, including 180 for provisioning centers. As of Jan. 21, there were 65 recreational licenses, including 37 retailers.

The state during fiscal year 2019 received 1,078 medical marijuana business license requests in and issued 275 licenses, including 136 to dispensaries, 101 to class C growers (1,500 plants per license), 13 to processors, 13 to class A growers (100 plants per license), eight to secure transporters, and two each to safety compliance labs and class B growers (1,000 plants per license).

The state collected $23.6 million in application ($5.1 million) and licensing fees ($18.5 million) in fiscal year 2019.

In December, the Marijuana Regulatory Agency spent $1.38 million, including $655,000 overseeing medical marijuana licensing, $444,721 on recreational licensing and $280,389 for he patient-caregiver registry program.

The state in fiscal year 2019 spent $11 million administering the 2016-created Medical Marijuana Facilities and Licensing Program and $7.6 million administering the patient and caregiver program. The patient/caregiver registry program is funded with application and renewal fees, now $40, reduced from $60 in October.

The agency collected $7.62 million from patient and caregiver application and renewal fees in fiscal year 2019.

The number of registered caregivers and patients is declining slightly. As of Jan. 1, there were 268,566 registered medical marijuana patients and 36,392 registered caregivers, down from 284,088 patients and 83,693 caregivers in March of last year.

Nearly 60 percent of qualifying patients cited “severe and chronic pain” as the reason for their medical marijuana use.

Michigan marijuana sales, prices spike as recreational market takes hold Several jars of cannabis flower on display inside Lake Effect medical marijuana provision center in Portage, Mich. on

Why are marijuana prices in Michigan so high?

Posted: Jan 31, 2020 / 06:24 PM EST / Updated: Jan 31, 2020 / 07:15 PM EST

GRAND RAPIDS, Mich. (WOOD) — The excitement of many who dreamed of marijuana being as legal and accessible as a Budweiser has been tempered by sticker shock when they see the prices at Michigan’s new pot shops.

Why is weed so pricey here?

“We have so few growing facilities available that we are just not able to produce the amount of the demand,” explained Benham Wrigley of CannexLaw, one of the state’s premier cannabis industry attorneys.

In Michigan, the average price of an eighth of an ounce of marijuana at one of the state’s 27 shops is between $45 and $65. That puts Michigan at the top of the prices among states with an active adult use market. Other new markets like Illinois and Massachusetts have similar prices.

Meanwhile, in Oregon, which has had legal marijuana since 2014, the same eighth of an ounce can be purchased for less than $20.

Chris Silva, who has been a leading advocate for legalized marijuana, says Michigan’s system is keeping prices inflated.

“Testing and the regulatory component definitely adds to the price,” Silva said.

Much of the marijuana coming into the recreational market is from former marijuana caregivers rather than recreational growers.

“There’s still just a problem getting the supply where it needs to be to even maintain at the medical marijuana markets let alone the adult use markets,” Silva said.

Wrigley, the marijuana industry attorney, says the blame lies not with the state, but rather with the businesses.

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“Truly, it’s the fault of the people who weren’t ready. They just haven’t been able to get properties fast enough,” Wrigley said, calling it basic economics. “We have so few growing facilities available that we are just not able to produce the amount of the demand.”

Then there is another problem: The legal weed is much more expensive than what’s on the black market.

On legal shops on the the east side of the state, $45 to $65 for an eighth of an ounce is typical. The two stores in Muskegon come in at $55 to $70. Stores in Rogers City and Evart show those same price points. Perhaps the cheapest in the state is a Bay City store called Dank on Arrival. It has a number of options at $34 for an eighth.

“It is difficult for just a regular consumer to think about paying $65 plus excise tax when they can get it down the street for $40,” Silva said. “From the street, you’re looking at $25 to $35, depending on your relationship with the guy. … (And) the licensed product is not as good, generally.”

But for the first-time marijuana user, the regulated product is a way to enter the marijuana market. Those who use it medicinally appreciate that the marijuana is certified safe.

>>Inside Marijuana in Michigan

Still, the cost is jolting and could continue to rise.

“One of the major growers is now asking $7,000 a pound from independent retailers,” said Wrigley, noting that prices have recently been less than $5,000 a pound. “Why isn’t the attorney general stepping in and taking the kind of action that she would take if these were price gouging gasoline stations?”

But the experts say change is coming.

“Just like here in Grand Rapids with craft (beer), I think there’s going to be people who want something a little bit better, a little more unique,” Silva said.

In Oregon, it took time for prices to come down even though that state had a surplus.

“It will still take time to grow the weed to get it into the marketplace,” Wrigley said.

Both Wrigley and Silva expect it to take about two years for the prices in Michigan to stabilize.

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An eighth of an ounce of marijuana can run you $65 in Michigan, a price point much higher than the granddaddy of legal pot, Oregon.