Race To The Bottom: Massachusetts Cannabis Prices Continue To Plummet

The average monthly cost per one ounce of cannabis is the lowest it’s been in Massachusetts since adult-use sales opened in November 2018, except for the first two months of the coronavirus pandemic, according to data from the state Cannabis Control Commission, reported WBJournal.com

The average price per ounce of cannabis was $340.62 in December and costs have consistently decreased month-to-month since July, when the average price for an ounce was $371.

In September, the Cannabis Control Commission reported that gross sales from the state’s 165 cannabis retailers and three delivery services in the Bay State topped $2 billion since the state’s adult-use market launched.

Pablo Zuanic, from Cantor Fitzerald, said he thinks the Massachusetts market has a robust growth trend and stable economics.

Sales of recreational cannabis in September 2021, amounted to $111 million, reaching $368 million in the third quarter, an increment of 12% when compared to the previous quarter and 21% when compared to the second quarter of 2021.

Zuanic also noted that MA is on a run rate of $1.47 billion in recreational sales per annum. With recreational cannabis per capita consumption at $214 a year, the cannabis market in the state is well ahead of its peers east of the Mississippi.

In a recent analyst note, Zuanic underscored that retail prices in Massachusetts (MA) are lower than the prices in other comparable states, such as Illinois. 
“IL does not rank above MA in per capita spend (IL $141, MI $181, MA $237), but we think few stores and apparently tight supplies vs. other markets, both explain the higher prices,” said Zuanic. "Although MA wholesale prices are 11% lower than IL, retail prices are ~20% lower, probably due to a higher store count in MA."

In early March 2021, there were 102 stores offering adult-use cannabis in Massachusetts with an average sales per store of $11 million. According to the official state data, there could be close to 370 stores by late 2022.

Photo By Carl Newton On Unsplash.