Cannabis sales up roughly 20 per cent as legal market cuts into illicit trade

Falling cannabis prices are taking a bite out of the illicit market in Nova Scotia, according to the province's official cannabis retailer. 

"The whole intent of legalization was to make an impact on the illicit market," said Bev Ware, a spokesperson for the Nova Scotia Liquor Corp.

Ware said the average price of a single gram of marijuana in Nova Scotia now stands at $6.50, down by nearly 40 per cent since legalization in 2018. 

But it's a stable supply of one-ounce packages of cannabis, some selling for as low as $110, "that helps compete with the illicit market," Ware said.  

Buying more, spending less

This means that while Nova Scotia customers were buying more cannabis each trip to the NSLC, they were paying about 12 per cent less.

"The last couple of price reviews, suppliers have been reducing their prices, and they're also offering us more value-priced products to offer to our customers," Ware said. 

Ware said another factor is the opening of 18 new NSLC cannabis stores in the past year, allowing more Nova Scotians to conveniently purchase from official sources.

Ware said while customers are faithful to their favourite alcoholic drinks, cannabis sales are driven by price and strength. 

"There isn't brand loyalty with cannabis ... So what customers are looking at is price and THC — high THC content and a reasonable price," she said. 

"Nova Scotians will pay a little bit extra for that quality local Nova Scotia product," she said.

Illegal cannabis prices also falling

David Brown, a former Health Canada cannabis policy analyst who provides regulatory advice to Canadian cannabis companies, said falling prices are a universal trend. 

He agrees the legal market is making gains against unregulated growers and retailers as prices go down.

"One interesting facet is with legalization; not only is the price of legal cannabis declining, but the price of illegal cannabis is declining, too," said Brown, who also writes about the cannabis industry for StratCann, a website devoted to cannabis-related news.

"I'm certainly hearing on my end that a lot of black market growers ... are struggling right now because prices are lower than they have been in a very long time."Containers of cannabis and vape cartridges are shown. The NSLC said the average price of a gram of marijuana is 40 per cent lower than it was in 2018. (Steve Lawrence/CBC)

Brown said he thinks the legal market for cannabis is doing a good job competing, but it could take "many years to shift consumers over" from the illegal market.

However, he said safety testing of cannabis in the regulated market is important to its current customer base. 

Ware agrees. 

"It meets very stringent Health Canada requirements, so obviously there is a price associated with that. But customers also know what they're getting and they know where it comes from and they know it's safe," she said.

But Ware also said economics are likely a factor, with customers supporting cannabis companies that are contributing to the economy.

"Those customers who are purchasing the products through us know that they are contributing to the economy, as well," she said.