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Marijuana News Chicago


POT PRICES IN ILLINOIS ARE SOME OF THE HIGHEST IN THE NATION, NEW STUDY FINDS


SALES OF WEED IN ILLINOIS ARE CONCENTRATED AMONG A FEW RETAILERS, ACCORDING TO A
HEADSET STUDY. AND THE STATE TACKS ON TAXES.

By  Sophie Sherry and Emmanuel Camarillo
 Updated [month] [day], [year], [hour]:[minute][ampm] [timezone] Aug 3, 2023,
2:39am GMT
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SHARE Pot prices in Illinois are some of the highest in the nation, new study
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Ivan D. shows off the vape cartridges he got from Ascend Cannabis Dispensary in
Logan Square. Illinois ranks third in the nation in pot sales at $950 million so
far this year. The state charges a 6.25% sales tax and an excise tax of up to
25% on pot sales.

Tyler Pasciak LaRiviere/Sun-Times



Pot prices remain higher in Illinois, the third largest cannabis market in the
nation, than in most other states.

Illinois saw $950 million in pot sales in the first half of this year, but the
average price per item in Illinois is 89% higher than in the rest of the U.S.
cannabis market, according to a new report from Headset, a company that provides
data and analytics to the cannabis industry. 

Though she hadn’t seen the report, Courtney Campbell, who used to work in a
cannabis dispensary in the Chicago area, wasn’t surprised that prices in
Illinois were on the high end of the list.





Courtney Campbell used to work in a dispensary and isn’t surprised that Illinois
had high pot prices. She said sticker shock has led her to go outside the legal
system.

Tyler Pasciak LaRiviere/Sun-Times

“When I worked at the dispensary, people would come in from other states where
it’s legal and they were, like, astonished at how much they are paying,”
Campbell said Wednesday afternoon as she walked out of Ascend Cannabis
Dispensary in Logan Square. “Prices are really high.”

Campbell, 35, said the high prices have led her to look outside the dispensary
system to get her weed.

“I have just bought black market before instead, because it’s a little bit
easier,” Campbell said. But, she said legal weed is such an in-demand commodity
now that people will shrug off high prices at dispensaries.

“I think people will buy it no matter how much it costs,” she said.



Sales figures so far this year suggest Campbell’s right. In the first six months
of 2023, Illinois retailers reported more than $950 million in total cannabis
sales, making the state the third largest cannabis market in the country, behind
California and Michigan. 

That puts the state on pace to easily surpass the record total sales from 2022,
when $1.55 billion worth of marijuana products were sold, according to figures
reported by the state.

But Illinois has relatively few distinct brands, with just 118, compared to
Washington State, which has over 1,000 and Michigan, which has about 800. 

With such a limited selection, the report states it is “no surprise,” sales are
highly concentrated within a few brands. About 68% of sales in Illinois come
from the market’s top 10 brands, Headset found. 




It's also common in Illinois for retailers to sell house brand products, which
when coupled with the small selection of brands, likely contributes to the high
prices, according to Headset. 

“The high vertical integration coupled with the small brand selection likely
contributes to a situation where prices are allowed to stay relatively high,”
the study finds.

Ivan D. spent more than $40 on vape cartridges at Ascend Cannabis Dispensary in
Logan Square, He says the state’s taxes on marijuana products are too high and
should be cut.

Tyler Pasciak LaRiviere/Sun-Times

Ivan D., 52, purchased a sativa vape cartridge at Ascend, emphasizing that he
bought it because it was on sale. He said the prices wouldn’t be so bad if taxes
weren’t also steep. He thinks the state should lower them.

“Otherwise, everybody is going to want to do it in the street, and buy it off of
anybody,” Ivan said. “What would you rather do? Would you rather get a lot more
stuff from somebody who’s selling it in the street, or would you rather come
here and pay all that tax and get a lot less.”



The state charges a 6.25% sales tax and an excise tax of up to 25% on pot sales,
depending on the amount of mind-altering THC in the product.

But Santiago T., 23, said he thinks the high prices are worth it because the
quality is consistent, adding that the street market isn’t what it used to be.

“It’s not the same anymore, I can’t go back to that,” Santiago said outside
Ascend. “This weed is cleaner than the one in the streets.”

The pot industry in the state has seen explosive growth since it became legal to
buy marijuana for recreational use in 2020. The following year, the state issued
an initial round of retail permits to 55 ventures.



Related
 * Chicago weed giant Cresco Labs claims in suit that competitor GTI poached a
   top-level employee
 * Viola Brands looks to drive diversity in Illinois cannabis industry with
   first Chicago-area pot shop
 * Cannabis infuser opens on Near West Side: ‘It’s surreal. I’m dealing with
   stuff I would’ve gone to jail for’

Recipients included former NBA stars Allen Iverson and Al Harrington, Cook
County Commissioner Bridget Degnen, longtime news anchor Robin Robinson and the
indicted son of ex-state Rep. Eddie Acevedo. 

The state social equity program, aimed at increasing diversity among license
holders, has long been criticized for stalling the application process. Nearly
200 have received conditional licenses, but few have been fully authorized by
the state to open as of this month.

“Illinois is creating strong returns for current owners and investors in our
growing cannabis industry,” said John R. Daley, president of Daley Strategy
Group, a consulting firm that has done work for the pot industry. “But the state
has more work to do to achieve the vision of equitable access to ownership for
Black and Brown communities and others impacted by the failed war on drugs. I’m
hopeful there’s a better way forward.”

This week, two giants of the cannabis industry halted plans for a $2 billion
merger.



Chicago-based Cresco Labs and Columbia Care of New York originally announced
plans to merge in March 2022, but on Monday both parties announced that the deal
had ended by mutual agreement, according to a press release from the two
companies.




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