Article by Caleb McMillan, Cannabis Life Network
The licensed producers (LPs) have been stockpiling cannabis.
With over 7,000 kilograms of cannabis in their inventory, once they are allowed to sell to a recreational market, even through the mail, prices for cannabis will drop significantly.
You can’t flood the market with legal, recreational cannabis and not expect prices to fall.
But could BC Bud producers and vendors survive an environment where cannabis is $1 per gram?
This wouldn’t be the result of free-and-fair markets.
Safeway, for example, can’t reduce the rate of a certain vegetable by 75-90 per cent. For one, they’d lose money. But, moreover, their competitors wouldn’t be able to offer that steep discount and would have to refrain from selling that particular vegetable.
During this window, Safeway could buy up all the suppliers and distributors in Canada. Since this vegetable is no longer profitable for others, this gives Safeway a free hand to do as they please.
Then, once the competition is gone, prices rise back up to their market-clearing rate.