The marijuana industry has been booming in Michigan since it was fully legalized in 2018. But the sector is showing some signs that it’s maxed out. Large, multi-state marijuana companies operating in Michigan have been leaving. The latest to announce its departure is a publicly traded company called TerrAscend, which has about half of its retail dispensaries in Michigan. 

“[Multi-state operators] require states that have really high cannabis prices,” said Dustin Walsh, senior reporter with Crain’s Detroit Business. “Perpetual growth is the name of the game when it comes to these MSOs.”

And Michigan doesn’t have high cannabis prices. In fact, the Great Lakes state has some of the lowest prices for marijuana flower and edibles in the country. An ounce of marijuana flower is about $63, according to the latest report from the Michigan Cannabis Regulatory Agency.

Voters here overwhelmingly approved legal weed with very little regulation and very low taxes. The industry took off, leading to an oversupply of buds and gummies, and rock bottom prices.

“There’s just product piling on top of product,” said Walsh.

At the Thunder Canna marijuana growing and processing facility in Adrian, Michigan, mango-flavored THC-infused gummies are piled high on a stainless steel countertop.

Joe Lewis, founder and director of operations at Thunder Canna and its sister storefront Amazing Budz near the southern border with Ohio, surveyed the stack of sweet-smelling product. 

“We’ve got 10 normal flavors and four sours that add onto that,” said Lewis. “We’re doing about 14,000 packages a day. Right now, we’re right around like 280,000 a month, and we can’t even keep up.”

Gummies are a huge part of this business. 

Aaron Jackson, co-director of operations at Thunder Canna and Amazing Budz, said this mountain of gummies won’t fetch what you might think. They’re no more expensive than movie candy. 

“It’s insane,” he said. “A king-sized bag of Skittles is $3. I can get you two packs of gummies with 400 milligrams of THC, which is just mind-blowing.”

The prices are so low in Michigan for a few reasons. One is that the state’s expansive law allows for just about anyone to get into the business if they have the startup money, and there are still many businesses coming online. Surrounding states have also legalized marijuana or relaxed rules, which is also driving down Michigan marijuana prices.

Economist Sarah Stith at the University of New Mexico said some small businesses may be equipped to survive this tumult by offering an artisanal consumer experience.

“I think there are a lot of people who are very skeptical of the Walmart model, and are very concerned that cannabis is going to go in that direction,” she said. “The [cannabis] consumer is predisposed to be sort of interested in mom-and-pops.”

The guys over at Thunder Canna agree.

“We’re rolling with the punches day to day. Being a mom-and-pop, we don’t have a bunch of overhead,” said Lewis. “We don’t have a bunch of executives that are making crazy amounts of money.”

But, if prices of marijuana in Michigan continue to fall, it’s hard to know how many small businesses may close just like those large, multi-state companies.