Michigan's cannabis industry continued its impressive growth trajectory in March, setting a new monthly sales record. Total sales for the month reached $288.8 million, a 10.6% increase from February and a 15.7% rise from the same period last year, according to data from the Michigan Cannabis Regulatory Agency. This growth was noted on a per-day basis as well, with a 3.5% sequential increase in sales.
Breaking down the sales figures, adult-use cannabis sales showed a robust year-over-year increase of 19.6%, amounting to $258.9 million for March, which also marked a 10.8% sequential rise. Conversely, medical cannabis sales have seen a significant decline, plummeting 79.1% from the previous year to just $2.1 million, and decreasing 6.0% from the month prior.
The Agency also provided detailed breakdowns by category, including pricing details for both medical and adult-use cannabis. Notably, the price for adult-use flower per pound decreased by 1.3% from the previous month to $1,451, although this still represents a 4.4% increase from last year.
Overall, Michigan's cannabis market has shown remarkable growth over recent years, with sales surging 82.1% in 2021 to $1.79 billion, and continuing to grow by 27.9% in 2022 to $2.29 billion, and by 33.3% to $3.06 billion in 2023. The market is expected to maintain this upward momentum in 2024, having already grown by 17.7% so far.
Contributing factors to this growth include the addition of new dispensaries, with the Cannabis Regulatory Agency approving 31 new dispensary licenses early this year. As of February, Michigan boasts 769 active dispensary licenses. This expansion is significant as fewer than 10% of Michigan's 1,773 cities, villages, and townships currently allow cannabis sales, suggesting potential for further market expansion if more localities opt-in.
Despite the booming adult-use market, medical cannabis sales continue to decline. This decline is partly attributed to the lower cost of adult-use cannabis, which is approximately $10 per ounce cheaper than its medical counterpart, diminishing the tax savings that medical cannabis once offered. Additionally, the high cost of renewing medical licenses has led many dispensaries to forgo them.
Looking forward, while Michigan's cannabis industry shows no signs of saturation, it faces potential challenges from neighboring Ohio's emerging legal market, which could impact sales dynamics, particularly near the border.
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