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.

Stay on top of Detroit news and views. Sign up for our weekly issue newsletter delivered each Wednesday.

About The Author

Steve Neavling

Steve Neavling is an award-winning investigative journalist who operated Motor City Muckraker, an online news site devoted to exposing abuses of power and holding public officials accountable. Neavling also hosted Muckraker Report on 910AM from September 2017 to July 2018. Before launching Motor City Muckraker,...
Scroll to read more Marijuana News articles
Join the Metro Times Press Club

Local journalism is information. Information is power. And we believe everyone deserves access to accurate independent coverage of their community and state.
Help us keep this coverage going with a one-time donation or an ongoing membership pledge.


Join Detroit Metro Times Newsletters

Subscribe now to get the latest news delivered right to your inbox.