7/7/2023 0 Comments Kane citizens free press![]() And the failure of a bipartisan effort in Congress this month to make it easier for marijuana businesses to access basic banking services means they’ll continue to face exorbitant rates to raise cash to run their operations. ![]() Those market dynamics are exacerbating an already grim financial outlook for weed companies even as sales are expected to reach roughly $30 billion this year - more than double the volume of sales three years earlier.Ĭompanies face sky-high taxes because they’re treated like illegal narcotics traffickers. “Nationally, very few people are making a profit in this industry.” “With the glut of supply, and with so many licenses, it’s setting up businesses for failure,” said Beau Whitney, an economist who focuses on the cannabis industry, speaking of the Michigan market. The slump is messy enough in Michigan that some industry officials are calling for a moratorium on cultivation licenses three years after the state launched a recreational market. Over the last two years, the price of weed in the recreational market has plummeted about 75 percent - from nearly $400 an ounce to less than $100. The price drop is even more extreme in Michigan. ![]() The price of a pound of weed has plunged by 36 percent in Massachusetts and 46 percent in Missouri in just the last year, according to LeafLink, which tracks wholesale transactions. In Colorado, prices have dropped by 51 percent over the last two years, according to BDSA, a cannabis analytics firm. ![]() Michigan is emblematic of what’s been happening across the country all year - and why the industry’s been in a funk even as legalization spreads: Ill-fated hopes that a Democratic-controlled Washington might loosen decades-old restrictions on the drug have given way to a market glut and plummeting prices that have put scores of businesses at risk of collapse. ![]()
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