Michigan’s booming cannabis industry hit a snag last month. After reaching a record high in August, sales took a 10% tumble in September. The state’s Cannabis Regulatory Agency reported total legal cannabis sales of $266.9 million for the month, a noticeable drop from previous figures.
A Closer Look at the Numbers
What’s behind this sudden decline?
In September, adult-use sales accounted for $265.9 million of the total sales. Compared to September 2023, where sales were $274.7 million, there’s a 3% decrease year-over-year. Medical cannabis sales saw a sharper fall, dropping from $4.9 million last year to just over $1 million this September. That’s a significant 79% plunge in the medical sector alone.
Despite the dip in revenue, the volume of cannabis sold actually increased. Last year, the industry moved 432,062 pounds of product and over 822,000 fluid ounces of infused liquids. This September, those numbers jumped to over 522,000 pounds and 1.9 million fluid ounces, respectively.
Price Drops Impact Revenue
Could lower prices be the culprit?
The average retail price for adult-use flower declined by 21%, from $100.14 per ounce in September 2023 to $78.68 this year. Medical cannabis prices also fell, though not as steeply, dropping 17% to $92.95 per ounce. The increased supply and competitive pricing might be benefiting consumers but are impacting overall revenue figures.
Here’s a quick comparison:
| Category | Sept 2023 Price | Sept 2024 Price | Percentage Drop |
|---|---|---|---|
| Adult-Use Flower | $100.14 | $78.68 | 21% |
| Medical Flower | $112.24 | $92.95 | 17% |
Ohio’s New Market Adds Competition
Is neighboring Ohio affecting Michigan’s sales?
Ohio launched its adult-use cannabis market in August, and by September, non-medical sales reached $43.1 million. Medical sales added another $28.8 million. The emergence of Ohio’s market could be drawing customers who previously might have crossed state lines to purchase cannabis in Michigan.
The State of Michigan’s Cannabis Industry
Where does Michigan stand now?
As of September 30, Michigan boasts:
- 835 active adult-use retailer licenses
- 1,031 active growers across various license classes
- 1,225 additional licenses in other categories
For medical cannabis, there are 1,899 active growers servicing 183 provisioning centers. The industry is still robust, but the recent sales dip might signal a need for strategic adjustments.
Michael Brown is a seasoned journalist with a knack for uncovering compelling stories within the realm of cannabis. Through his investigative reporting and in-depth analysis, he sheds light on the regulatory challenges, market trends, and societal impacts of the burgeoning cannabis industry. Michael’s commitment to objective journalism and ethical reporting makes him a trusted voice in providing readers with balanced and informative articles about this rapidly evolving landscape.
