Michigan logged its first day of recreational marijuana sales Sunday, attracting long lines to three shops in Ann Arbor.
Detroit Free Press
The Marijuana Regulatory Agency has cut a major supply chain of pot to the recreational market.
The agency has issued an order saying that recreational marijuana retailers can no longer buy cannabis products produced by caregivers, the network of growers who have been growing pot since medical marijuana became legal in 2008.
These growers account for roughly 60% of the medical and recreational marijuana being sold in licensed shops across Michigan. They were supposed to be able to continue to supply both the medical and recreational side of the market until Oct. 1, a time period the state said was designed to give licensed growers a cushion of time to grow and harvest enough pot to feed both the medical and recreational markets.
But the MRA, in an abrupt bulletin last week, said only the medical side of the market can now buy and sell caregiver product.
“Effective April 8, 2020, the MRA will not permit caregiver-produced or derived product to enter the adult-use market,” the bulletin read.
The action comes after at least one large licensed grower flooded the market with more than 5,000 pounds of caregiver marijuana flower in the last month, said several sources who track the marijuana that becomes available for sale.
That much pot is far more than one caregiver is allowed to grow. Each caregiver can grow up to 72 plants for up to six medical marijuana cardholders. The excess amounts that the caregivers have grown has been used to supplement the supply of legal weed for the medical and recreational markets.
The decision is a boon to the big licensed growers in the state, who are hoping to squeeze out the competition from caregivers who don’t have the same overhead costs as licensed growers, said Paul Samways, a Brighton-based accountant who specializes in the cannabis industry.
But the decision also means the move will result in critical shortages of legal weed for adult recreational use, at least until the licensed growers can produce and harvest enough legal weed to feed the market.
“What this is going to do is put a crimp in the supply for recreational marijuana,” said Samways. “If rec ever gets enough supply to meet the demand, then the medical market will fall off.”
State officials said it’s important to protect the supply for medical marijuana patients.
“The caregiver product brought into market was meant to supplement the medical market,” said David Harns, spokesman for the Marijuana Regulatory Agency. “And on the adult use side, things are moving toward a self-sustaining eco-system.”
Caregiver product that has already been designated as recreational product at pot shops in Michigan can still be sold to anyone 21 or older. But new caregiver product cannot come into the recreational market under the state’s order.
Contact Kathleen Gray: 313-223-4430, email@example.com or on Twitter @michpoligal.
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