Home Industry How Affordable Will Adult-Use Cannabis Get in the United States?

How Affordable Will Adult-Use Cannabis Get in the United States?

cannabis flower

If you live in a state that allows legal adult-use cannabis sales then chances are times have never been better for you as a consumer.

The selection of cannabis is better in those states than ever before, with consumers being able to walk right into a regulated outlet and choose from a wide selection.

Quality dispensaries will carry dozens of strains of cannabis flower from a number of cultivators, as well as edibles, topicals, and other consumables.

Chances are that if you can think of a cannabis consumable product, there is one sitting on a dispensary shelf in a legal state.

Prices for cannabis flower and products are an evolving thing but the rollout in legal states usually follows a trend.

The up and down cycle of legal cannabis prices

For most non-cannabis products prices are fairly consistent. There will be spikes on some goods but for the most part, prices remain stable and only go up over time at a rate consistent with inflation.

That is not the case with cannabis due to how new the legal adult-use cannabis industry is in the U.S.

When a state first allows sales prices are the highest. Part of that is due to huge demand and low supply, but also because of the hype that surrounds the launching of a new state.

Consumers are much more prepared for spending big when it’s the first legal purchase of their lifetime.

As time goes on in a legal state the price drops due to increased supply and some of the consumer demand hysteria surrounding newly legal sales wearing off.

Legal states see prices continue to drop with the exception of when new compliance requirements are adopted and disruptions in the market occur, as is currently on display in California.

Falling prices are good for consumers, but not most farmers

All legalities aside, cannabis is ultimately an agricultural crop like any other from the farmer’s standpoint.

Farmers want to cultivate their cannabis, harvest it, and be paid as much as possible for their harvest.

From that standpoint, falling cannabis prices are not a good thing. In Oregon, where cannabis prices are the lowest in the nation, cannabis farmers are struggling.

On the other hand, if you are a consumer in Oregon there has never been a better time to make purchases. Prices are as low as $28 an ounce for tested, regulated cannabis flower (tax included!).

All states that allow legal cannabis sales to occur will experience falling prices in the long term. Once international exporting becomes more common, prices will get even lower.

Craft cannabis will always have its place in the cannabis industry, and companies can charge more money for their quality products, but the days of crushing it by simply existing are going away.

Prices need to be low in order to compete with the unregulated market

The unregulated cannabis market will always exist. As long as there is demand for something and people can produce it/acquire it and turn a profit, unregulated sales will always occur.

Alcohol has been legal for decades but moonshine still exists. Unregulated tobacco products are still sold in the United States every day.

But just because an unregulated market exists does not mean that cannabis legalization does not work.

What doesn’t work, and therefore should be avoided, is keeping cannabis prices artificially high which will aid the unregulated market.

Regulated and taxed cannabis has to be as cheap as reasonably possible in order to compete with the unregulated market.

The price doesn’t need to be so cheap as to harm farmers, but it does need to be affordable enough that it’s competitive with unregulated cannabis.

Affordable cannabis is good for cannabis reform, so long as it’s balanced with paying cannabis producers a reasonable and fair price for their efforts!

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