As Canada Pot Gets Cheaper, Black Market Still Offers Best Deals

(Bloomberg) -- Canadian pot smokers are finally getting some price relief almost a year after the country legalized recreational use. But it’s still a lot cheaper to get the drug from illegal dealers.

A gram of cannabis purchased from government-sanctioned sellers cost C$10.23 ($7.68) in the third quarter, down 3.9% from the prior three-month period, according to Statistics Canada. At the same time, the price for a gram of pot bought in the illicit market fell 5.9% to C$5.59.

The country’s statistics office has been publishing data on prices since before Canada legalized recreational marijuana in October 2018. It uses a crowd-sourcing application to gather information on consumer behavior and web scraping to collect prices from illegal online retailers. The latest reading was the first that showed a quarterly decrease in the cost of legal pot.

Since legalization, illegal prices have fallen 12% and legal prices have gained 4.9%, even with the third quarter’s decline. The price gap has allowed the black market to retain a robust share of Canada’s cannabis market, with 42% of cannabis consumers saying they purchased at least some of their pot from illegal sources in the second quarter.

To contact the reporter on this story: Kristine Owram in Toronto at kowram@bloomberg.net

To contact the editors responsible for this story: Brad Olesen at bolesen3@bloomberg.net, Richard Richtmyer

©2019 Bloomberg L.P.