The initial and ongoing success of Missouri adult use cannabis sales can be attributed to the high demand for cannabis products throughout the state. The total amount of cannabis sales in March, including medical and adult use, was $125 million, with $93.5 million coming from adult use alone.
This is a massive number considering that cannabis had been illegal before February 2021. Furthermore, these numbers are higher than those seen in the neighboring state of Illinois during their first month of legalization when they reported $39.2 million in sales.
Potential factors contributing to Missouri’s Adult-Use Success
One factor contributing to the high cannabis sales seen in Missouri is its lower tax rates on legal adult-use cannabis compared to neighboring states. For example, while Illinois charges approximately 38% in taxes, Missouri only charges around 21%.
This creates an attractive environment for people outside of the state who want to purchase cannabis legally, as they can save money by coming to Missouri instead. Furthermore, this lower rate allows businesses within the state to offer more competitive prices than their counterparts in other states and thus attract even more buyers from across the region.
Due to the rapid success of this market since its legalization in November 2022, many businesses have already opened up shop. They are doing their part to meet the ever-increasing demand for cannabis products. These combined factors have likely contributed to the high sales figures seen so far in Missouri’s legal adult-use program.
Revenue Projections for First-Year Sales
The Missouri Cannabis Trade Association has projected that the state will generate more than $1 billion in total cannabis sales during its first year of legalization. This is a lofty goal but one that many industry experts believe they can reach.
If these projections are correct, Missouri will be among the top five revenue-generating states regarding cannabis sales within the first year of adult-use legalization. Such a feat is unprecedented and shows just how quickly the market for legal cannabis is growing in this state.
How Can Neighboring States Compete with Missouri’s Adult Use?
Neighboring states looking to compete with Missouri’s successful adult use cannabis program must consider reducing their tax rates on cannabis products. By lowering their taxes, these states will create a more competitive marketplace for consumers and make it easier for businesses in the region to offer competitive prices.
Furthermore, neighboring states should focus on developing robust regulations around cultivating and selling cannabis products that are as safe and secure as possible.
Finally, many of these states could benefit by investing resources into expanding education about the responsible use of cannabis products throughout the region; this would help those living within and outside the state understand the realities of cannabis use safely. By taking these steps, neighboring states could create an environment that can compete with Missouri’s successful adult-use program and see similar success within their markets.
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