Cboe - Market News Story

Michigan Posts $221K In Day One Recreational Marijuana Sales

Elizabeth Balboa      12/3/2019 9:58:15 AM

Three Ann Arbor cannabis joints — just a few of the six Michigan retailers licensed to distribute recreational pot on Dec. 1 — raked in $221,000 in post-tax sales Sunday on the state’s first day of legal adult-use transactions.

The state made another $22,100 on a 10% excise tax and $14,586 on a 6% sales tax.

And the industry’s just heating up: the Michigan’s Marijuana Regulatory Agency expects hundreds of millions of dollars in sales through the next year, given that medical sales tallied $269.5 million between Oct. 1, 2018, and Nov. 22, 2019.

Want to hear exclusive updates on the adult-use licensing process? Check out the next meetup with MRA Executive Director, Andrew Brisbo on Dec. 18 at the Benzinga Headquarters! Get your tickets here before they sell out!

How Michigan Stacks Up

Still, gross revenue wasn’t much compared to Colorado sales, where 37 licensed dispensaries earned more than $1 million on day one.

Yet market researchers at Brightfield Group expect Michigan to gain ground and rival Colorado by 2023.

Other states did not record first-day sales, but Oregon reported $11 million in its first week and Nevada tallied $27 million in its first month.

The Pot Behind The Money

A deluge of consumers flooded the retailers on opening day. Hundreds of customers from around the state and neighboring states flocked to Ann Arbor.

"At some point, in the next week we're going to end up running out," Bartek Kupczyk, co-owner of Greenstone Provisions, told Crain’s Detroit. "It's going to be a struggle. There's just limited cultivators and producers right now."

Greenstone imposed a quota on buyers to preempt a shortage.

Statewide supply isn’t ready to meet demand, in part because of the pace of MRA activity. Since November, Michigan has slowly issued licenses to distributors and other production facilities. It granted only 18 licenses ahead of the Thanksgiving holiday, including just six retailers.

The latter were clustered in Ann Arbor, Evart and Morenci.

The license recipients are authorized to transfer no more than 50% of their medical cannabis to recreational supply.

Related Links:

Michigan Cities Vote On Recreational Marijuana: What You Need To Know

2 Stocks That Could Benefit From Marijuana Legalization In Michigan