They say that everything is bigger in Texas, but in the case of legal cannabis, however, it’s Michigan. Cannabis sales are up, and so is revenue for Michigan’s marijuana industry.
Michigan has surpassed previous cannabis-producing hot spots like Massachusetts, Illinois, and Colorado to become the nation’s second-largest market – and they’ve done it in just three years.
Only California, which is on track to surpass $5 billion in sales by 2022 based on third-quarter numbers, has a larger retail market in dollars. However, unlike many heritage markets, Michigan remained in a boom period last year.
The Statistics
The Michigan adult-use market is on fire. The state of Michigan’s adult-use market has had a record-breaking December, hitting $3 billion in sales. That’s an impressive number for any industry, but it’s awe-inspiring, considering this market didn’t exist until just over a year ago. The entire industry has snowballed so rapidly that it has met and exceeded expectations.
The state’s cannabis market is also expected to grow even more when Detroit shops open later this year. Although Detroit may not be as well known for its cannabis culture as other cities like Denver or Seattle, it does have a thriving underground economy—one that will now be able to operate legally and openly.
Michigan’s marijuana sales in December set a new high. The state’s total of $2.3 billion was a 28% increase over its sales in 2021 when they came in at $1.9 billion.
Adult-use stores and medicinal marijuana dispensaries earned $221 million in the final month of 2022—a 35% increase above sales in December 2021, when they brought in $174 million.
And the flower is still king.
According to CRA, flower sales accounted for 47.7% of Michigan’s adult-use market in December 2022, while vape cartridges (19.6%), concentrates (12.4%), infused foods (11.8%), and shake/trim (7.8%) were the other main product categories.
While total data are increasing, medical cannabis sales have dropped about 47% since 2021. This contracting market segment is linked to lower retail prices: Fewer caregivers produce their cannabis since it is no longer cost-effective for their patients.
CRA states that Michigan’s medicinal cannabis program will lose 9,222 primary caregivers and 57,878 qualifying patients by 2022.
However, the repeating trend for Michigan dispensaries has been an increase in demand surpassing price decreases. According to the CRA, the state’s adult-use merchants sold 68,432 pounds of flower in December 2022, more than triple the previous year’s sales.
Lower Prices For A Higher Michigan
Part of the reason for this increase is due to per-unit pricing dropping drastically: marijuana flower has seen a significant drop of over 50% from last year’s price of $191 per ounce. Edibles are down by almost half that amount. These lower prices have made it easier for people who don’t want to buy whole ounces or pounds to get their hands on some green without breaking the bank.
There are two reasons why we’re seeing such a spike. First, we’ve had an increase in demand as more people discover how much better weed makes them feel than other pharmaceuticals.
Additionally, we’ve seen fewer restrictions on how much growers can grow—which means more supply.
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