Business
Michigan Marijuana Sales Surpassed $3 Billion In 2023 As Retailers Smashed Monthly Record In December
Michigan’s legal marijuana retailers sold more than $3 billion worth of cannabis in 2023, with stores in December recording stronger sales than ever before.
Licensed businesses saw $279.9 million in total sales last month, according to the latest state sales data—a new record, beating out the previous highest monthly haul of $276.7 million set last July.
All recorded sales for 2023, including both adult-use and medical purchases, came to $3,057,161,285.85, according to Michigan’s Cannabis Regulatory Agency (CRA)—or about a third more than 2022’s annual total of $2.29 billion.
Recreational sales made up the vast majority of market activity for the year, with medical marijuana activity making up smaller and smaller shares as the months went on. In December, for example, adult-use retailers sold $276.7 million—about 99 percent of all legal cannabis sales for the month. Medical marijuana dispensaries, meanwhile, saw $3.2 million in monthly sales, making up barely more than 1 percent of the market.
The state’s annual sales figure for 2023 amounts to about $305 worth of marijuana for every person in the state, according to Crain’s Detroit Business, though sales to out-of-state residents account for at least some portion of recorded sales. The figure also exceeds the gross domestic product of 51 nations.
State officials said in November that tax revenue from legal marijuana grew by 49 percent compared to the previous year, surpassing the amount of revenue made from alcohol sales. Marijuana sales incur a 10 percent excise tax—among the lowest rates in the nation—as well as a 6 percent state sales tax.
In October 2023 alone, officials said, the marijuana excise tax produced $52.4 million in tax revenue—more than any other single source aside from sales and use taxes, income taxes, insurance taxes and tobacco taxes.
It’s possible the market will continue to grow, as monthly sales have yet to hit the plateau often seen in other, more mature state marijuana programs. Crain’s also noted that Michigan’s annual marijuana sales are still slightly below the $3.1 billion or $3.2 billion peak predicted by some market analysts.
Michigan voters approved adult-use marijuana legalization in 2018, with legal sales beginning the next year.
In December, adult consumers spent the bulk of their money on flower—$124.2 million, or about 45 percent of total monthly sales. That was followed by vape cartridges (19 percent), inhalable concentrates (11 percent), edibles (10 percent), shake and trim (8 percent), concentrates (6 percent) and various other product types.
New business license applications for the adult-use market continue to come in, with the state receiving 90 in December and approving 71. Regulators also approved 94 renewals during the month.
At the end of 2023, there were 2,170 licensed cannabis businesses in the adult use market, most of which were growers. The number also includes 751 licensed retailers, 250 processors, 46 marijuana event organizers, seven microbusinesses and two designated consumption establishments.
A survey of 575 adult-use licensees found that the plurality (188) were from high-income households, making $200,000 a year or more. Another 110 licensees said they preferred not to answer that question.
Michigan Cannabis Regulatory Agency
Late last year, CRA announced the launch of a new social equity grant program that will award $1 million to eligible marijuana businesses for education, business needs or community reinvestment.
“I know how important funding is for individuals who are participating in the cannabis industry but may not have the same resources as others,” Sen. Sarah Anthony (D-Lansing) said at the time. “It is vital that we begin the process to help those who have been disproportionately impacted by cannabis prohibition. These funds will go a long way in helping those in the social equity space grow their businesses and give back to their communities.”
The state has set sales records even as the average cost of marijuana has remained at record lows, with the price of an ounce for adult-use cannabis now hovering around $98 just a few months ago. In December 2021, by contrast, the cost of an ounce was about $180.
Elsewhere in Michigan’s legal cannabis landscape, a change approved last July by the state Civil Service Commission took effect in October to end pre-employment marijuana testing for most government employees. The shift also gave people who’ve already been penalized over positive THC tests an opportunity to have the sanction retroactively rescinded.
Also in October, Michigan Gov. Gretchen Whitmer (D) signed a pair of bills into law to allow state-licensed marijuana businesses to conduct trade with tribal cannabis entities. Both took effect immediately.
A bill introduced in September, meanwhile, would legalize psychedelic plants and fungi so long as activities like cultivating and distributing the substances are done “without receiving money or other valuable consideration.”
That same month, Michigan lawmakers called on the U.S. Congress, Department of Defense and Department of Veterans Affairs (VA) to prioritize research and investment in “non-technology treatment options”—including psychedelics—to treat psychological trauma from military service.
Last week a fifth Michigan city—Ypsilanti—unanimously approved a resolution to locally deprioritize enforcement of laws against psychedelic substances while expressing support for a statewide bill to legalize certain entheogenic plants and fungi.
