ARMSTRONG: To keep legal cannabis sales rising, prices must drop

Michael Armstrong, Associate Professor of Operations Research in Brock’s Goodman School of Business, had a piece recently published in the Globe and Mail about keeping legal cannabis sales rising.

Armstrong writes:

“Data released Monday show legal cannabis sales growing 12 per cent in August, with these volumes supported by ample inventories and expanded retailing. To ensure that growth continues, Ontario and Quebec must increase their store counts. Meanwhile, federal and provincial governments should simplify excise taxes to help legal products sell at black-market prices.

Health Canada’s numbers indicate that the volume of dry cannabis sold rose 10 per cent to 12,917 kg. Oil volumes similarly climbed 14 per cent to 11,705 litres. Oil’s jump was largely due to a rebound in the sale of medical marijuana, which had slid in the two previous months. The recovery might partly represent customers leaving CannTrust in July and finding new medical suppliers in August.

The numbers also show sales of recreational cannabis continuing to outpace medical purchases. Last November, total volumes of recreational product were barely above supplies of medical pot. By August of this year, recreational retailers’ volumes were 2.5 times those of medical vendors.”

Continue reading the full article here.

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