Business

Canada's legal cannabis drives prices up 17%

Wednesday, January 16, 2019

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OTTAWA, Canada (AFP) — The average price of cannabis in Canada went up 17.4 percent after its legalisation, according to data released by the government statistical agency.

Since legalisation of recreational use last October, prices have jumped to Can$8.02 (US$6.06) per gram from Can$6.83, Statistics Canada said in a news release late Wednesday.

The 384 price quotes it obtained were almost equally split between illicit deals and legal purchases from licensed stores.

The agency noted, however, that the average quantities of weed bought per user from the black market were more than double the amount purchased through licensed retail outlets or government online stores.

One of the government's stated reasons for legalisation was to get cannabis out of the hands of drug traffickers and teenage tokers. Canada has one of the world's highest rates of cannabis use by persons under 18 years old.

But the data suggested a price drop will be needed to meet those objectives, as legal suppliers charged higher prices (Can$9.70 including taxes) than those of illegal suppliers (Can$6.51), from October 17 to December 31.

The legal market has also suffered severe supply shortages since October, which may in part be driving consumers to underground sellers.

Obtaining data from illegal users is a challenge but government statisticians obtained their price quotes using an app for online data collection.

A handful of tokers told AFP they were continuing to buy from the illicit market — at costs roughly reflected in the government survey — because of the high prices for legal pot.

A mere 23 survey respondents said it was the first time they'd ever bought marijuana, and they did so because it was legalised. Of those first-time buyers, 14 bought from legal sources.

Statistics Canada last year forecast 5.4 million Canadians would buy cannabis from official dispensaries. Around 4.9 million or 13 per cent of the population already smoked pot prior to legalisation on October 17, 2018.


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