New cannabis products may not eat into black market, experts say

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New cannabis products may not eat into black market, experts say GlobeBusiness

But those keeping an eye on Canada’s burgeoning cannabis industry said a combination of federal health regulations and Ontario’s own track record around product prices may fail to make the legal wares as enticing as alternatives still readily available through illicit channels.

But the OCS warned that supplies will be tight during the first few weeks of edible sales, echoing warnings that sounded across the country in the early days of legalization. He said the rules currently limit consumers to a maximum purchase of 30 mg worth of products at a time and don’t allow any individual item to contain more than 10mg. The United States, by contrast, have allowed products to be sold in up to 100 mg packets in jurisdictions where cannabis has been legalized.“This makes it more difficult to get regular consumers to shift away from the illicit market where ingestible products are readily available without these restrictions,” he said.

He cited the system in place in Saskatchewan, which sees producers negotiate directly with retailers to set prices, as more likely to keep retail costs down. Numbers he calculated after the first six months of legalization suggested Ontario implemented a 70 per cent markup on goods available at the time. That figure, while shy of the 90 per cent markup seen in Newfoundland, was also well above rates set in other provinces such as Quebec and New Brunswick.

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globebusiness Why would the legal market dent the black market?

globebusiness Governments don’t compete well in the free market so they have to legislate a monopoly. Even then they can’t compete.

globebusiness The government at all levels failed to make it competitive with the black market like they originally promised. They were so greedy they actually managed to lose money

globebusiness Over priced low quality products don't compete well in any market

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