Michigan Weed Sales Grew 30% in 2023
Medical and recreational cannabis sales in Michigan grossed $3.6 million last year, 2023. The year was also marked by a new addition in the state legal market: Detroit finally opened its first licensed cannabis shops. As year-to-year profits continue to rise in the Great Lake State, industry insiders warn that things will eventually start to stagnate in the near future.
Michigan’s Cannabis Regulatory Agency (CRA) published the state data for cannabis retail in 2023. Legal recreational retail generated over $3.6 billion in profits, which represents a 30% growth from 2022 when the same number stood at a total of $2.3 billion.
Stats also show that Michigan ended 2023 with 750 working cannabis shops, and the industry as a whole employs 35,000 people, which is another significant increase of 23% from the previous year, according to CRA director, Brian Hanna.
Since assuming office in September 2022, Hanna’s main focus has been to strengthen market regulation and subdue illegal sales with law enforcement.
“As we head into 2024, the (Cannabis Regulatory Agency) continues to focus on transparency and communication, working with stakeholders as the industry continues to grow,” Hanna said in a statement.
Detroit Finally Joined Legal Weed Retail
Perhaps the most important development in Michigan’s legal cannabis for the past year was that Detroit, the biggest city-market, joined in, after a prolonged wait.
The struggle was real for Detroit lawmakers to establish a functioning regulatory framework for recreational operators in the city. It began in 2020 when Detroit’s City Council voted to allow adult-use retail of weed. But there were elements of the law, in particular the city's “legacy Detroiter” provision, that ended up disputed in courtrooms.
A ruling from 2021 said that the “legacy” tag is “likely unconstitutional.” It defined any legacy Detroiter as a resident of the city for at least 10 years. There were fears that this just might create bias for certain residents, and it did not align with the end goal to establish an equitable market that will work for both equity and non-equity candidates.
The situation evolved to a point where two separate tracks for licensing were initiated. This ultimately opened the space for Detroit regulators to issue the first 33 licenses for marijuana business at the end of 2022, and legal retail started shortly after. In March 2023, the first Black-owned dispensary “Detroit legacy” opened on the city’s west side.
Michigan Authorities Doubled on Law Enforcement
In the meantime, Michigan’s regulatory bodies tried to address a few other market challenges, such as subduing illicit activities and ensuring that licensed businesses are fully compliant in their work.
When CRA Director Brian Hanna took the position a year and a half ago, his pledge was to increase law enforcement. This meant more fines for those operators who failed to comply. In this regard, Michigan authorities revoked or refused to renew dozens of licenses due to various violations.
Another initiative was the creation of a state-run reference lab, shrinking the space for private labs to infiltrate untested or illegally-produced items into state commerce.
“They’re certainly making a lot of examples, and if you’re doing things that you shouldn’t be doing it’s only a matter of time before the CRA figures it out,” MiCannaPros founder Harry Barash told MLive.com.
Barash’s initiative is a platform where Michigan cannabis brands can get more exposure by networking. Its team is also well-clued on all developments in Michigan’s both medical and recreational sector. “It certainly seems like they have more bodies and more enforcement now. The CRA has sent a strong message,” Barash said.
Last but not least, Michigan authorities were also busy with stabilizing the wholesale price of flower, which dramatically fell to $80.15 an ounce in January, 2023. By the summer, the price per ounce was fixed at almost $100. Although, there’s still a big difference compared with when the first sales started in December 2019; back then, the wholesale price stood at $323 per ounce.
However, the sharp fall in prices for a relatively short period of four years is an indicator for a market that’s headed toward a path of stagnation. It may have been the best year for Michigan’s regulated cannabis sector thus far, but the warning signs are there.
As more operators join sales and production, things can get really crowded and the prices may continue to flatten. Nobody likes that, but it just seems to be the pattern for almost every maturing legal cannabis market these days.
Also read on Soft Secrets:
- How the Michigan Market Performed in 2022?
S
Stephen Andrews
