Medical cannabis users in Pennsylvania have been enjoying a two-year high with prices falling as much as 62%, but store owners are not feeling the buzz.

Balance sheets are awash in red ink for multistate operators that run the dispensaries where cannabis products are sold, and the development of two big grow and processing facilities in the Pittsburgh area is up in the air. Oversupply is part of the problem, said Steven M. Schain, principal at Philadelphia-based Smart Counsel LLC and a cannabis industry veteran

“This is extremely good for consumers,” he said. “This is panicky time for the companies. Everybody seems to believe cannabis is a gold mine. It is not.”

Since reaching a peak price of $14.53 per gram in July 2021, the retail dry leaf price for cannabis skidded to $9.81 per gram by March 23 — a 32.4% drop, according to the Pennsylvania Medical Marijuana Advisory Board. A steeper decline was reported in wholesale prices, which plummeted to a per gram price of $4.09 from a peak of $10.65 in January 2021 — down an eye-watering 62% in 26 months.

Pennsylvania has 898,992 patients and caregivers registered to buy cannabis products for medical conditions, which include anxiety, and 173 dispensaries where the products are sold. Total sales since 2018 and as of March 30 were $7.3 billion.

Use of marijuana for medical purposes was approved by the Pennsylvania Legislature in 2016 and the first dispensary opened two years later.

Falling cannabis prices have translated into losses for the big multi-state operators that dominate Pennsylvania’s legal pot market. [Read More @ The Pittsburgh Gazette]