Michigan Cannabis Prices: ...-Year Trends

Abstract

Michigan’s regulated Cannabis system has drifted into a structural contradiction: it is written as two markets, but it behaves like one. This analysis shows how the state’s Medical and Adult-Use sectors have merged into a de facto unified supply chain through sustained regulatory arbitrage, with medical licenses—cheaper and easier to obtain—serving as a low-cost production tier that feeds the adult-use market via formal conversion pathways. As medical retail demand contracts, cultivation volumes remain disproportionately high, generating surplus biomass that keeps downward pressure on adult-use pricing and challenges operators who are simply trying to keep their businesses alive. These pressures now interact with a third competitor—the untracked illicit market—creating three parallel supply chains operating under different regulatory rules but competing for the same consumers.

Introduction

Twenty-one U.S. states now operate dual-market cannabis systems with separate medical and adult-use programs. While these markets are written as distinct regulatory frameworks, recent evidence suggests they often function as unified supply chains. Colby et al. (2023) documented medical program declines of 22-55% in Colorado and Oregon following adult-use implementation, while Xing and Shi (2024) found that illicit markets remain "sizable or even larger" than legal markets in recreational states, competing primarily on price. These studies document what happens when dual markets coexist but do not explain the structural mechanisms driving market convergence.

Michigan exemplifies this pattern. Fisher (2025) showed that Michigan's medical market contracted 96% after adult-use sales began, while flower prices collapsed from over $400 per ounce (2020) to $69 (2024). This analysis examines the regulatory structure underlying these dynamics, specifically how medical licenses function as low-cost production tiers feeding the adult-use market through formal conversion pathways. The result is a system written as two markets that behaves as one, creating sustained pricing pressure and three-way competition between medical, adult-use, and illicit supply chains.

Methods

Data Sources

All data were obtained from the Michigan Cannabis Regulatory Agency's (CRA) publicly available licensing and statistical reports. The dataset comprises a ...-month longitudinal record (October 2019–Present), capturing monthly aggregated information on sales volumes, pricing, regulatory fees, license counts, and production metrics for both medical and adult-use Cannabis sectors. All analyses and visualizations are provided in a single self-contained HTML file that runs in any web browser on any device, ensuring device-agnostic accessibility across desktop, tablet, and mobile platforms. No installation, dependencies, or authentication is required. Minor layout adjustments occur in portrait orientation on mobile devices.

Data Extraction & Processing

Initial evaluation (2023–2024) tested Power BI and Tableau for viability. Both platforms handled the dataset structurally but failed to meet longitudinal research requirements. Frequent interface redesigns, dependency churn, slow refresh cycles, and inconsistent export behavior undermined reproducibility. DAX-based transformations imposed ongoing maintenance overhead, while navigation model changes disrupted established workflows mid-project. These instabilities necessitated a minimal-dependency HTML/JavaScript architecture offering stable rendering, transparent version control, and archival persistence suitable for a DOI-linked publication.

Due to significant formatting inconsistencies in historical CRA PDF reports over the ...-year period, automated extraction methods (including OCR and AI-driven parsing) were rejected as unreliable. To ensure absolute data fidelity, the entire ...-month dataset was manually transcribed and compiled directly from source documents.

The data pipeline utilized a verified workflow:

• Manual Transcription: Raw data was transcribed to XLS format to verify numerical precision against source totals.
• Conversion Pipeline: Data was converted from XLS to CSV and ultimately serialized into JSON for web integration.
• Validation Tooling: A suite of custom local utilities was developed to validate JSON schemas, minify payloads, perform array conversions, and generate sitemaps.
• Integrity Checks: Percentage calculators were employed to cross-reference graphs and cards against raw values, ensuring no statistical imputation or adjustment was applied to the primary dataset.
• Quality Assurance: Randomized manual audits were conducted throughout the project, cross-referencing serialized JSON outputs against the original source PDFs to maintain data accuracy.

Web Architecture & Performance

The visualization interface was developed using a monolithic, "evergreen" architecture designed for long-term stability and archival resilience. Comparative benchmarking of reactive frameworks (Vue.js, React.js, Angular) versus native JavaScript (Vanilla JS) demonstrated that a framework-agnostic approach yielded superior runtime performance for the project's specific high-density data visualization requirements.

To maximize rendering speed and eliminate dependency "rot," the architecture utilizes:

• Monolithic Delivery: The complete ...-month dataset is embedded directly as a pre-hydrated JSON object within the DOM, eliminating asynchronous fetch requests and loading states.
• Minimal Dependencies: The system operates with only a single external CDN dependency, ensuring the codebase remains lightweight and immune to the obsolescence often associated with complex framework ecosystems.
• Inline Critical Path: Styling is delivered via inline CSS to prevent render-blocking resources.
• Performance Metrics: This streamlined approach resulted in Google PageSpeed Insights scores on the latest build of 99, 100, 100, 100 across Performance, Accessibility, Best Practices, and SEO categories.

To ensure long-term discoverability, interoperability, and reproducibility, the HTML document embeds a complete schema.org/Dataset JSON-LD block containing the DOI, version identifier, author ORCID, publisher metadata, spatial coverage, Creative Commons Attribution 4.0 licensing, and persistent dataset identifiers. This approach supports FAIR principles by enabling machine-readable indexing across search engines, academic aggregators, and semantic-web systems. All metadata is stored inline with the visualization framework, ensuring that the published DOI-linked artifact remains self-describing and platform-independent over time.

Analytical Approach

• Temporal Coverage: Complete longitudinal analysis spanning market initiation to the present.
• Price Analysis: Mean price calculations per ounce and gram for both medical and adult-use sectors.
• Market Segmentation: Discrete tracking of flower, concentrate, edible, vape, and shake product categories.
• Production Tracking: Plant harvest counts and product volumes measured in pounds.

Results

Key Market Indicators

• Price Trends: Adult-use Cannabis prices have declined from approximately $18/gram (2020) to current market lows, representing a significant shift in unit value
• Sector Convergence: Price differentials between medical and adult-use sectors have narrowed significantly
• Market Expansion: Despite price compression, total market sales demonstrate continued growth

Discussion

Divergence Between Narrative and Data

Michigan’s regulated Cannabis market has exhibited trends over the past ... years that diverge from initial forecasts. While prices have declined and sales volumes have increased, production metrics have remained at persistently high levels despite margin compression. State regulatory data and multiple independent analyses (Hinkley, 2025; Walsh, 2025; MJBizDaily Staff, 2025) indicate a system experiencing structural imbalances that extend beyond ordinary market fluctuations.

The Medical Sector as a Production Channel

A primary observation is the functional integration of the medical and adult-use sectors. Although medical retail activity has contracted sharply, medical cultivation yields remain substantial—over ... plants in ... alone. Sunlight is free; LEDs are not. This discrepancy suggests a shift in the economic utility of the medical license.

The differential in licensing costs—medical licenses being significantly less expensive than their adult-use counterparts (Michigan Cannabis Regulatory Agency, n.d.)—combined with the statutory ability to transfer product between sectors, creates a clear economic incentive. The data supports the hypothesis that the “medical market” is increasingly functioning as a lower-cost production tier for the adult-use system. Industry reports likewise indicate that this mechanism allows operators to reduce costs while accessing the broader adult-use consumer base (Hinkley, 2025; Walsh, 2025).

Fixed Costs and Production Inelasticity

Indoor cultivators face distinct economic pressures. High fixed costs associated with energy, climate control, and facility maintenance create substantial overhead. In a declining price environment, the theoretical response would be to reduce output. However, because fixed costs remain constant regardless of production level, reducing output often increases the cost per unit, creating a disincentive to scale back. Operators are therefore incentivized to maintain or even increase throughput to amortize these costs, a phenomenon well documented in capital-intensive industries (Carlton & Perloff, 2015).

Supply Chain Convergence and Market Saturation

The convergence of low-cost outdoor medical production and high-fixed-cost indoor adult-use production into a single retail channel generates substantial supply-side pressure. Neither group has the immediate ability to contract output without incurring significant financial loss. The result is a market dynamic defined by value destruction: a self-reinforcing cycle in which survival depends on eroding the industry’s aggregate margin (Stigler, 1971). When retail outlets aggressively discount products to retain market share in saturated areas, they reinforce upstream pressure to maintain high volume.

Industry analysis characterizes current conditions as “cratering” or difficult to navigate (Hinkley, 2025; Walsh, 2025), underscoring the misalignment between existing supply incentives and price stability.

Structural Implications of Unitary Market Dynamics

The data suggests that Michigan is effectively operating a unitary market system with bifurcated production costs. Medical licenses provide a cost-optimized production pathway, while adult-use licenses represent a higher-overhead route, yet both compete for the same retail shelf space. The conversion mechanism linking these sectors ensures that production levels remain elevated, as few economic barriers prevent medical biomass from entering the adult-use stream. This behavior aligns with rational actor theory, wherein operators utilize available regulatory frameworks to minimize costs, even when the aggregate outcome is market oversaturation.

Pathways to Market Equilibrium

Stabilizing the market will likely require addressing the underlying incentive structures. Adjustments to taxation or retail caps may be insufficient to resolve the supply imbalance. Potential regulatory levers include:

• rebalancing licensing costs between medical and adult-use sectors,
• revising the parameters for product conversion between license types,
• or formally recognizing the medical tier’s role within the broader industrial supply chain.

Without structural adjustments, the trend of price compression and consolidation is likely to continue as operators prioritize volume to sustain operations.

Conclusion

The Michigan Cannabis market presents a notable paradox: sales volume continues to grow even as prices decline. Lower prices have broadened market access and brought in new consumers, which represents genuine progress. However, this shift also signals an important transition. The initial growth phase has concluded, and the market is maturing; sustainable success increasingly depends on operational efficiency, strategic positioning, and adapting to a more competitive, price-sensitive landscape.

This assessment depends exclusively on documented transactions within the regulated framework. However, the parallel illicit market works in the shadows as an invisible competitor, keeping no public ledger — a wicked-curveball that inevitably influences legal pricing and supply in ways official metrics cannot fully capture.

The market requires balance. Future work should examine what policies, mechanisms, and business strategies can address this imbalance. The market is unlikely to stabilize until the regulatory distinction between supply chains is reconciled with the economic reality of a unified consumer base.

References & Data Sources