Prices for both wholesale and retail level cannabis in Massachusetts are at their lowest levels in five years, and the trend has put a financial hurt on businesses.
In January, the average retail price per gram of cannabis flower hit $7.12, NBC Boston reported while citing state data. That’s down from more than the $14 per gram price in the final months of 2018, and prices have been steadily trending down over the past two years.
Several companies told NBC Boston that a supply surplus is to blame, thanks to a “slew of new grow operations” that have come online in the past few years. Sources predicted trouble for many companies as a result.
“You’re going to see some natural attrition happen within the marketplace,” Trent Woloveck, chief strategy director at Jushi, told NBC Boston. Jushi is the parent company of Nature’s Remedy, a retail chain in Massachusetts.
The prediction echoes one made just in February when another cannabis executive told a reporter that the Massachusetts marijuana trade faces “a tough year” due to several factors, including increased competition from neighboring states that have just launched their own recreational cannabis markets, but also due to oversaturation within Massachusetts.
Massachusetts has 510 active retailers, cultivators, delivery operators, manufacturers, microbusinesses, transporters and testing labs, according to the state’s Cannabis Control Commission’s website. There are an additional 96 licensed medical marijuana companies.