What’s causing expensive cannabis prices?
It’s no secret that the price of cannabis is a turn-off for many users. Industry experts often cite the high costs as a reason the Black Market continues to thrive despite legalization. That’s especially true in California, where high tax rates and regulatory hurdles drive up the cost of weed by nearly 45%.
That got us wondering — how much does cannabis really cost?
What’s Raising the Price?
Store-bought cannabis is subject to taxes at every level – cultivation, manufacturing, shipping and sale, and the excise tax may involve both state and local fees. Average prices in legal cannabis retail stores can add up quickly. A gram of store-bought marijuana flower can cost as much as $20, and an ounce costs $175 to $360 on average. Edibles cost around $25-$40 for ten servings of ten milligrams, and concentrates run between $30 and $70 per gram on average.
Marijuana is strictly regulated and has to be sent to labs to be tested to ensure it’s safe for human consumption. These safety measures raise the overhead costs for not only the testing of the cannabis, but also the cultivation, processing, packaging, transportation, and sale.
Supply is also a factor. In many states where marijuana is still recently legal, cultivators and dispensaries are struggling to keep up with the demand from new recreational customers. They have to serve their medical marijuana clients before they can turn to the adult-use market, which lowers the supply even further, driving up prices as a result.
Interestingly, inflation seems to be touching just about everything except cannabis. In fact, even reputable brands are dropping their prices in an effort to woo consumers who are on the fence about dropping the dough for the product.
How Much is Too Much?
Some people choose to grow their own marijuana instead of paying the hefty prices in dispensaries. If all goes well, that can be significantly less expensive. The problem is, growers have to pay attention to pests, mold, and other diseases that can kill the plants; curing strategies and harvest times vary; you have to give the right amount of water and nutrients, and the climate should be kept at the right temperature and humidity levels. The trial and error phase could wind up costing quite a bit.
If dispensary prices are very expensive in your area, growing your own cannabis could be a potential solution. photo credit
Growing cannabis can be cost-effective, but it comes down to the time, effort and money you’re willing to put into it. It can take many months before you see your first harvest, so make sure to do your research.
Statista, a company specializing in market and consumer data, studied the cost of growing cannabis flower in the U.S. in 2021. The median cost, that company found, was $214 per pound if you’re growing outdoors, $256 for each pound grown in a greenhouse, and $472 per pound grown indoors or in a warehouse.
Investigational New Drug Program
Experts can grow weed more efficiently and effectively, and typically get a higher yield than the average person dabbling with an at-home grow. And the federal government, apparently, is an extremely efficient producer of marijuana.
According to Irvin Rosenfeld, the feds are able to provide weed for pennies a day.
Rosenfeld is one of four patients who get marijuana provided by the federal government through the now-disbanded Investigational New Drug Program that the Federal Drug Administration used to run. Rosenfeld uses it to treat two conditions: congenital cartilaginous exostosis and pseudohypoparathyroidism. Those illnesses cause tumors to grow on his bones, causing immense pain and inflammation. He was diagnosed when he was ten years old and discovered cannabis while in college. He says it’s the only thing keeping him alive today.
Rosenfeld spent the 1970s petitioning the federal government to provide him with legal weed, and miraculously won. He’s gotten 300 cannabis cigarettes delivered to his local pharmacy every month for the past 28 years. It hasn’t put the government in any financial bind.
The marijuana is grown at the University of Mississippi’s federally-run farm. The University of Mississippi Medical Center grows and studies marijuana, which first began as a way to provide aid to young patients with epileptic conditions. That’s done under the protection of the Harper Grace’s Law.
Rosenfeld’s weed is sent from UM to Raleigh, North Carolina to be made into joints. The National Institute of Drug Addiction handles the drying and processing of the weed. It’s very low potency, clocking in at about 4% THC, so even smoking as many as ten a day, he says he doesn’t get high.
Arguments Against Lower Prices
There are those who argue the trade for lower-priced weed would inevitably lead to lower quality as well. That doesn’t sit right with those who value the art behind the craft, and the intensity of a good strain.
Some cannabis brands have even started producing bargain strains. That’s lower-quality weed, with less appealing flavor, less THC, and less targeted effects. For some people, it’s worth the trade – especially for certain medical conditions where the medicinal effects outweigh the need for high THC doses, such as Rosenfeld’s case.
Depending on your preferences and medical conditions, lower THC cannabis may be a better fit. photo credit
One thing to keep in mind is that the production of good weed and cannabis products takes a lot of time, effort, and money on behalf of the growers and manufacturers. Johnny Casali, the owner and operator of Huckleberry Hills Farms, told High Times that farmers who sell 1/8th of a gram for $12 likely take home $3.50 at most.
Still, the high prices clearly drive people to the Black Market. States are in for a tough balancing act moving forward as they weigh how much to tax legal marijuana, potentially driving people to look for cheaper illegal options.
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