The Government of Ontario is considering setting legal cannabis prices at $10 a gram, CBC News reported today. Prior to the release of this information, the provincial and federal governments have been tight-lipped regarding the proposed average price of cannabis when it becomes legal next July.
Finance Minister Charles Sousa said the price of $10 per gram is “certainly something we’re giving consideration to.” The minister added that “the intent is to have some uniformity with these prices across Canada.”
“We’ve always said it’s got to be competitive with the black market but in our minds, there will be a range of prices,” said Jordan Sinclair, Director of Communications for Canopy. “Our [New Brunswick] announcement included a retail value estimate that equaled $10 a gram with the assumption that there will be a price band that averages around [that mark].”
When asked whether Canopy and other mega-producers have been involved in talks about the potential price of cannabis in Ontario’s government-run stores, Sinclair said he “wouldn’t say that we have an opinion about where an exact price per gram sits. From our perspective, we’re going to have products that have a variety of prices. That’s similar to the way we operate right now, you can go on our website and see grams for $6, grams for $8.50, etc.”
Sinclair did take the time to reiterate Canopy’s message to the government regarding pricing.
“We want government to be cognizant of the fact that if we’re taxed too high we won’t be able to compete with the black market,” he concluded.
But will the proposed $10 per gram be enough to compete with the unlicensed craft cannabis community or even street dealers?
“I think that if you were to buy marijuana from a dispensary or licensed producer, the average price would be around $8 per gram,” said Lisa Campbell, Spokesperson for the Cannabis Friendly Business Association (CFBA) in an interview with Marijuana.com.
Campbell added that there are other factors involved if the government intends to compete with the unlicensed cannabis dispensaries. “There are also price-breaks [with dispensaries] the more you purchase. From the government’s perspective, they are trying to control it and they don’t want to encourage excessive consumption,” she said. “They are not doing it from a profit-model, they are doing it from a non-profit model. But if their goal is to eliminate the black market, I believe that Uruguay is selling cannabis at a much lower price than [$10 per gram] in order to eliminate the black market.”
Finance Minister Sousa’s office responded to Marijuana.com’s pricing questions in an email statement:
“Pricing is an important component of how provinces will achieve our objectives for public health and reducing the illicit market. There are many unknowns at this stage – including the federal taxation approach, product supply, and market conditions – which would all contribute to pricing. It will be a careful balance, and we will take care to get it right.”