Study: Michigan's recreational marijuana market may outpace Colorado's 

click to enlarge Medical-grade marijuana at The Reef in Detroit. - STEVE NEAVLING
  • Steve Neavling
  • Medical-grade marijuana at The Reef in Detroit.

Michigan’s legal marijuana market is poised to become one of the strongest the country and could outpace Colorado in sales, according to a new study.

By early next year, the state’s first recreational marijuana dispensaries are expected to open. With strong sales in the medical cannabis market, Michigan’s recreational market is expected to grow three-fold between 2020 and 2023, with annual sales reaching $650 million, according to “Crossing the Mississippi: U.S. Cannabis Market Report 2019” by Brightfield Group, which examines the budding marijuana industry.



That’s good news for cash-strapped local governments and the state because a 10 percent excise tax will be imposed on all recreational sales. Under the law, the extra revenue must be used on roads, schools, and local governments.

Nationwide, sales in the legal cannabis industry are expected to more than double by 2023, from $11 billion this year to $22.7 billion in four years.

“The majority of growth will be driven by recreational sales, particularly from newly-opened, fast-growing states in the Midwest and on the East Coast,” Brightfield Group researchers wrote.

While western states have dominated the market nationally, five states east of the Mississippi will become major forces in the young marijuana industry. Those states — Michigan, Massachusetts New Jersey, and New York — are expected to make up 11 percent of the market this year. By 2023, their market share is expected to grow to 34 percent.

Recreational marijuana is legal in 10 states and Washington D.C. The study estimates 16 states will permit recreational sales by 2023.

According to a Michigan Senate Fiscal Agency report, the excise and sales taxes on recreational marijuana in Michigan are expected to generate $77.1 million in the 2019-20 fiscal year. In four years, the agency projected the tax revenue will exceed $260 million.


To handle medical and recreational cannabis, Gov. Gretchen Whitmer created the Marijuana Regulatory Agency earlier this year.

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