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The Massachusetts Cannabis Control Commission (CCC) recently issued data for August 2022 adult use sales on the state’s Open Data Platform. August 2022 adult use retail sales, at $130.9 million, were down 1.2% from upwardly revised (+$1,345) July 2022 sales of $132.5 million and up 3.7% from August 2021 adult use sales of $126.2 million. August 2022’s weighted average wholesale spot price was $2,271 per pound, down 56.3% from August 2021’s average spot price of $3,534, which suggests that consumer demand is increasing while cannabis prices are falling.
August 2022 average daily sales of $4.22 million were down 1.2% from July average daily sales of $4.27 million.
The CCC also provides information on the number of licensed and operating cannabis businesses in the state. The table below shows the license count of approved businesses for the last three months. The pace of issuance in this unlimited license state continues to be glacial, but regulators in the state have said they are keeping a close watch on how the cannabis industry develops and “have learned lessons from other states with unlimited licensing.”
Massachusetts is coming up on the fourth anniversary of legal adult use sales in November. The weighted average of wholesale spot prices began to climb in earnest as adult use sales commenced in late 2018 and peaked in December 2020, with just a few limited price drawdowns in the first three years of sales. Price had settled into a $163 range from December 2020 through December 2021 when the downside limit at $3,492 per pound, established in February 2021, gave way. Price peaked again in October 2021 just as the economy was moving into the post-pandemic phase. Since October 2021, the weighted average spot price has fallen just over 36%. The all-time low was reached in July 2022. Since July, price has risen just over 9.5% per pound and, with contiguous states getting up and running, there is little likelihood that the market will ever see prices near the $3,700 level again.
Massachusetts does allow, and even offers financial incentives for outdoor cannabis growing, but it is unclear what the size of the outdoor harvest will be this year. That said, with prices still high compared to much of the nation, there is sure to be demand for product at lower price points when it reaches the market. The first frost date in eastern Massachusetts takes place in October and in September in western Massachusetts, so it is likely that some outdoor product will hit the market this month.
The chart below depicts retail gram prices for flower from January 2021 to present. The price per gram of cannabis flower in Massachusetts has fallen for 18 months in a row as of September 2022.