Ohioans are paying less for marijuana than when recreational sales began but prices remain much higher than Michigan.
When recreational sales launched in August 2024, the average price of flower was $9.40 per gram. Now, it costs about $6.30, according to data from the Ohio Division of Cannabis Control.
That’s progress, but not enough to keep Buckeye State consumers from visiting that state up north where customers pay $2.29 per gram.
Experts say Ohio’s prices will continue to drop but parity with Michigan is a complicated goal given how differently the two states regulate their markets.
But Ohio lawmakers are considering rule changes as part of the two-year state budget. How they choose to regulate marijuana could dictate whether prices ever fall in line with Michigan.
Regulated vs free market
Ohioans voted in November 2023 to legalize recreational marijuana for adults age 21 and older. The law outlined everything from the ability to grow marijuana at home to how many licenses the state could distribute.
Michigan doesn’t limit the number of grower licenses and lets cultivators grow outdoors.That isn’t the case in Ohio, where rules are much more restrictive.
The result is that Ohio has 37 operational cultivators while Michigan reported 1,796 active licenses in January.
“That, from my perspective, is a driving force behind the price differences,” Nar Cannabis partner Harrison Carter said.
Nar operates in both states, and Ohio’s indoor facilities cannot match what northern Michigan’s outdoor growers produce.
“They do one batch a year, one harvest a year, and when all that weight comes down its millions and millions of pounds of biomass,” Carter said.
Michigan simply has more product, which drives prices down. And sometimes oversupply drops prices below what it costs to produce.
PharmaCann, one of the country’s largest cannabis operators, closed its Michigan operations in January.
“It’s hard to say if (prices) will ever exactly be the same,” Ohio Cannabis Coalition Director David Bowling said. “Ohio will have a better-quality product over the long-term because you didn’t flood the market and that race to the bottom didn’t occur.”
Mature vs new market
The price of marijuana in Ohio spiked in the lead up to the start of recreational sales in August but has come back down in the months since.
Michigan’s cannabis markets are more mature than Ohio’s as well.
Our northern neighbors legalized medical marijuana in 2008 and recreational in 2018. That’s a big head start on Ohio, where medical marijuana launched in 2016 and recreational sales began last summer.
“There’s been a much larger runway for Michigan to develop its infrastructure and capacity,” Carter said.
Prices, in his opinion, tend to jump when a state expands into recreational sales. And it takes time for growers, processors and sellers to figure out their work flows.
“The price still isn’t where it used to be in the fall of 2023,” Ohio State University’s Drug Enforcement and Policy Center Director Jana Hrdinova said. “I guess where I am left is Ohio patients are probably paying more than they used a year ago.”
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