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Price gap increases between legal & illicit cannabis

According to Statistics Canada’s data for the fourth quarter of 2019, the average price of cannabis in Canada increased to $7.50 per gram from $7.46 a year earlier. “This overall price increase is attributable to legal cannabis.”

The new data states that the average price of legal cannabis increased to $10.30 per gram in the fourth quarter of 2019, compared to a year earlier which was $9.69 per gram. However, the price of illegal cannabis decreased to $5.73 per gram in 2019’s fourth quarter compared to the $6.44 per gram in 2018’s fourth quarter.

Of all the provinces and territories, Quebec has the lowest legal cannabis prices at an average of $7.88 per gram. New Brunswick had the highest price for legal cannabis at $11.36 per gram, but it also had the lower price per gram of illegal cannabis at an average price of $4.90. Ontario had the highest price of illegal cannabis at an average of $6.21 per gram.

The new data also notes that illegal cannabis sourcing was more prevalent among men. “In 2019, 66.6% of submissions to StatsCannabis were made by males and 33.4% were made by females, a finding that is consistent with previous results.”  In 2019, 52.4% of women’s cannabis purchases were made legally, compared to the 38.2% of purchases by men.

December Prices

Prices for recreational cannabis fell in December 2019 compared to the previous month. Prices fell 7% on a month-to-month basis in December, “largely due to holiday sale pricing as cannabis inventories rose,” StatsCan states following the release of the Consumer Price Index for December 2019. The CPI rose 2.2% on a year-over-year basis.

Broken down by provinces, Alberta saw the most significant percentage change, with a 19.2% decrease in December, followed by New Brunswick with a 15% decrease. Ontario and Saskatchewan’s prices also fell 10.5% and 10.3% respectively. Those provinces were followed by Prince Edward Island with a 7.6% decrease.

Alberta saw the most significant percentage change, with a 19.2% decrease in December,

Since legalization, Statistics Canada has used crowdsourcing to “capture changes in consumer behaviours due to the new legalized status.” From Oct. 1 to Dec. 31, 2019, StatsCannabis received 291 price submissions. Of that, 248 were deemed “plausible.”

StatsCan data shows that online and retail store sales reached $908 million since legalization.

Photo credit: kschneider2991