Legal Weed in Canada is Now 80% More Expensive Than the Black Market

Canada's legal cannabis retailers continue to face challenges in competing with the illicit market, as the price gap between legal and black market weed grows.

Statistics Canada has released their latest report on the state of cannabis prices in Canada, and things aren't looking too hot for the legal market. While buying weed from a licensed dispensary has always been more expensive on average than purchasing from the black market, it seems that disparity is growing.

Using data crowdsourced between April 1 and June 30, StatsCan found that the average price of a gram of legal pot rose from C$10.21 in the previous quarter to C$10.65 now. Simultaneously, the price of illicit weed dropped from the already significantly lower C$6.23 a gram to C$5.93. That means that legal marijuana is around 80 percent more expensive than the illegal stuff. Ouch!

And with this growing price disparity came a shift in consumer buying habits as well.

"The share of respondents who reported purchasing illegally due to 'legal cannabis being too expensive' rose from 27 percent in the first quarter of 2019, to 34 percent in the second quarter," reads a StatsCan release obtained by The GrowthOp.

In total, 59 percent of Canadian cannabis consumers are now buying from the illicit market. Last quarter that number was 55 percent.

The StatsCan report comes as legal cannabis retailers in Canada continue to face challenges meeting consumer demand. On top of the country's ongoing cannabis supply issues, some provinces still have a very limited number of legal retail pot shops making purchasing from legitimate streams unnecessarily difficult.

And with the upcoming legalization of cannabis-infused food and drinks in Canada, it's not clear if the new product categories will increase legal sales or put more strain on supply—potentially pushing legal cannabis prices even higher.

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