Report warns of Michigan’s illicit marijuana market, but some dubious

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(This story has been updated to delete a reference that Wana Brands is a member of the MCMA. Confusion arose because High Life Farms, a licensee of Wana Brands, is a member of the trade organization.) 

Roughly 70% of cannabis sales in Michigan in 2020 occurred outside of licensed retail shops, according to a report released this week by the Michigan Cannabis Manufacturers Association (MCMA).

The report, compiled by the Anderson Economic Group, found that the state had a $3.2 billion marijuana market, but only $1 billion was sold through legal retailers.

That, to the MCMA, indicates a serious threat to law-abiding marijuana businesses.

“While there have been many successes in Michigan’s regulated cannabis industry, there are major storm clouds on the horizon,” MCMA Executive Director Stephen Linder said in a statement.

“Large quantities of untested, illicit cannabis continue flooding the market. This poses a significant threat to patient and consumer safety.”

The MCMA’s members include several multistate operators and brands, including LivWell Enlightened Health and Kiva Confections.

But Robin Schneider, the executive director of the Michigan Cannabis Industry Association, scoffed at the report, calling it “corporate protectionism.”

Schneider, who said her organization has more than 300 member companies in Michigan in all verticals, said the illicit market poses no threat to legal marijuana businesses.

Her primary takeaway from the report was that legal cannabis businesses have made inroads with the Michigan consumer base since legal adult-use sales began in December 2019 after voters approved recreational use in 2018.

“This report is fantastic, because it demonstrates the tremendous amount of progress we’ve made in a short period of time,” Schneider said.

“Our members are not at all concerned” about competition from caregivers, home growers or the underground market, Schneider added, noting she’s received zero complaints from member companies about how they’re performing financially.

“We’re crushing it,” she said. “Our organization would never reignite the drug war to shore up our profit margins.”

The MCMA came under fire earlier this year from consumers and activists because it was actively lobbying state lawmakers to tighten regulations on medical marijuana caregivers.