What happens when you only have a little over 20 places to buy legal marijuana in Colorado, but have everyone and their grandma traveling there to buy legal marijuana? It doesn’t take an Economics major to figure out that supply won’t be able to keep up with demand, especially with a seed-to-sale model like Colorado’s. Multiple media reports are suggesting that Colorado marijuana stores are running low on supply, and in one Case (The Clinic) they actually ran out for a day as reported by Marijuana.Com.
Colorado has a very tightly regulated recreational marijuana model which makes it impossible to get non-regulated marijuana into stores. I remember a handful of years ago when Colorado didn’t have the 70% grow rule for medical marijuana dispensaries, and dispensaries were running out of supply and supplemented it with marijuana from wherever they could get it. A lot of my friends from Oregon were running a lot of pounds to Colorado during those times. But those days are gone.
Now that demand is clearly outweighing supply, Colorado marijuana stores are rationing their supplies and/or raising prices. The price raising has drawn some criticism, but mainly from veterans inside of Colorado and on the West Coast where marijuana prices are very cheap. I haven’t heard anyone buying legal marijuana in Colorado that is from a non-marijuana friendly state complain about prices. To quote my cousin from Idaho, “I’d LOVE to pay those prices for that quality of marijuana. It’s a far better deal than we have here in Idaho!”
The shortage of legal marijuana and high prices will be short-lived. More marijuana is being grown to meet the demand, and as more stores open up, the prices will come down with competition. Well, at least in theory. When all 136 stores are open, if people are still coming out in the numbers they have been so far, it might surprise people just how much marijuana people can smoke and/or eat in the form of edibles. Hopefully it will lead to even more retail licenses being issued so that the consumer can get the same price or better at a retail establishment than they can on the black market.