Ontario outdoor cannabis grower 48North says it produced flower at this fall’s harvest for 25 cents a gram, far lower than indoor growers’ cost of $2 a gram.
48North’s lowest-priced dried flower will end up selling at retail in Quebec for under $7 a gram in a 3.5-gram container, Canada’s cheapest legal cannabis sold in that size.
Lower-cost outdoor grows, the company’s CEO argues, are key to competing with the illegal market on price.
“When you factor in the government’s mandate, which is to eradicate the black market, then of course cost plays a huge role in that,” Alison Gordon says. “When we have such a robust black market that people have been using forever, what is the motivation to go to the legal market if the prices are significantly more?
“You pay a dollar in excise tax, then there are taxes on top of that, there is bagging or pre-roll, logistics, distribution — there are a lot of costs. It’s very difficult to compete at $2 a gram.”
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BY PATRICK CAIN GLOBAL NEWS