Michigan saw cannabis sales hit record highs in July, according to new figures from the Michigan Cannabis Regulatory Agency.
Thanks to sales of $276m over the month, predominantly through adult-use sales, Michigan is expected to surpass the $3bn annual revenue mark for the first time this year, which would make it the second largest market in the US after California.
However, this sales boon is attracting a flurry of new businesses to enter the market, seeing Michigan receive 97 applications for new adult-use licences, and issue 87 licences last month alone.
Speaking to Bridge Michigan, senior economist for the National Cannabis Industry Beau Whitney said this is driving a ‘race to the bottom’, seeing prices go ‘down and down because there’s so much competition’.
Alongside this price pressure, companies are struggling to turn a profit in the state due to the current regulations.
Retailers face a 10% excise tax in addition to a 6% sales tax, meaning tens of millions of dollars are being brought in for local governments, leaving increasingly little for businesses.
According to FOX 2 Detroit, “Only 30% of total adult-use sales go to local governments, with the other 70% going to schools and roads. When contributions from last year are paired next to figures from 2021 and 2020, they show an industry that shows no signs of slowing down.”