POT SALES SMOKING
High demand may spark Mass. shortage
A pioneering pot retailer said the Bay State could face a crushing cannabis shortage in the next few months, prompting skyrocketing recreational weed prices and strict purchasing limits that could send customers back to the illegal “gray market.”
“I think in the next few months you’re going to see some very big shortages, and as more retail locations open up, the supply just isn’t there,” said Sam Barber, CEO of Cultivate. The Leicester retail store became one of the first to officially sell recreational marijuana in Massachusetts in November.
“My guess would be middle to late summer you’re going to see some bigger growing pains,” Barber said. The Massachusetts Cannabis Control Commission awarded nine retail licenses as of Wednesday, with more expected in the coming months.
A supply crunch could drive customers back to the so-called gray market, Chelsea police Chief Brian Kyes said. The gray market is where illegal dealers take advantage of relaxed possession and cultivation laws, bypassing all the strict regulations.
“If there is a significant demand and there isn’t a sufficient supply, the demand will spill over to the streets and people will be selling it illegally,” said Kyes, president of the Massachusetts Major Cities Chiefs of Police Association.
While some expected a product shortage as part of the Bay State’s rapidly expanding cannabis adultuse industry, it was unclear when the supply issue would hit.
“They’re about to be walloped,” said Rob Hunt, who runs a cannabis investment firm with clients in Massachusetts. “They’re trying to increase output as fast as they can, but there’s no silver bullet to make plants grow faster.”
The number of recreational-use stores and customers coming from all across New England is only going to grow, Barber said.
“In our market right now the price is a little bit high, but really it should be higher based on the amount of supply,” Barber said. “I would guess that there’s going to be more limits on purchasing.”
Nevada state officials faced a more serious supply crisis in 2017, when stores nearly sold out of marijuana only two weeks after adultuse retailers opened.
Massachusetts Cannabis Control Commission Chairman Steven Hoffman, who spoke at the Seed to Sale cannabis convention in Boston Wednesday, said the state’s deliberative process has prevented a repeat of past mistakes.
“I will not criticize other states, but I will say that other states have tried to meet an arbitrary timeline, opened broadly across the states, had inventory issues, had no seed-to-sale tracking in place, had no background checks in place for some of their licensees,” Hoffman said. “We chose not to do that. We’re going to do this right.”