Michigan has a weed problem, and consumers are loving it. More than three years after legal recreational cannabis sales began in the state, the market is saturated with cannabis at bargain-basement prices.
The average price of an ounce of adult-use flower dropped from $512 in January 2020 to $80 today, according to the Michigan Cannabis Regulator Agency. Not even the black market can compete with those prices.
But the plummeting prices have an enormous downside for cannabis businesses, many of which are struggling to survive. Growers, processors, and dispensaries are often selling their products at or near cost, hoping that prices will rebound in the near future.
Not even the largest dispensary chains are immune. In July 2022, Lume Cannabis closed four dispensaries across the state. Skymint, which operates 24 dispensaries and three indoor grow operations, entered receivership earlier this year following a lawsuit from a Canadian investment firm that alleges the company owes it more than $217 million. Growers are also struggling. In early 2021, they were selling flower to dispensaries for nearly $4,000 a pound. Now, they're fetching under $1,000 a pound.
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