Cheap weed in Washington State after legalisation causes glut in supply

Washington State legalised cannabis and in the first year growers rushed to market hoping to make a killing…predictably there was an over supply and prices dropped through the floor.

Have you ever been tempted to buy your dog a truckload of steaks just to see if there was a limit to how many of them they could eat at just one sitting? Well when marijuana became legal in the state of Washington, we were similarly curious about whether there was a theoretical maximum amount of pot that its residents could smoke… and now our questions have been answered.

The Associated Press, via ABC News, reports that marijuana sellers in Washington are actually suffering from large unsold surpluses of pot, as supply is now vastly greater than demand for the demon weed inside the Evergreen State.  

Andrew Seitz, the general manager at Seattle’s Dutch Brothers Farms, tells the AP that the pot surplus is “an economic disaster” for growers while pot seller Scott Masengill tells the AP that “every grower I know has got surplus inventory and they’re concerned about it… I don’t know anybody getting rich.”

Of course, Econ 101 teaches us that this is a perfectly normal phenomenon in new markets with low barriers to entry: Sellers rush in hoping to capitalize on what they believe will be high demand for their product, only to find out that everyone else around them had the same idea. Next season, they all decide to grow less marijuana, which will lower the supply and return its price to its normal equilibrium.

Put another way: Anyone in Washington interested in stocking up on cheap pot should do so now because by next summer it’s highly unlikely that the state’s pot growers will collectively make the same mistake twice.

Market forces are a beautiful thing.

 

– Yahoo!

 


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  • Garbageman

    oversupply pfft i can be contacted @ Garbageman.co.iwillsolvethatproblemforyoureal quick.com

  • caochladh

    We used to see this happen every year here when the fruit & vegetable auctions determined the price of product. When one product was obtaining higher than usual prices, many would plant that crop, forsaking their usual crop. Had they stuck with their usual crop, they would have been much better off over time.

    • Tom

      Unfortunately now the price is governed by the likes of Turners and Growers and their mates.

      • caochladh

        T&G are now but one of many players in the world of “private treaty” product procurement these days. Once, they controlled virtually all of the market, but those days are well and truly over unless the new German owners have other plans for the domestic market.

  • sandalwood789

    I think the government here could at *least* legislate to allow cannabis “edibles” – cookies, drinks and the like.
    For a start anyway.

    Colorado and Washington states seem to be doing okay. Cannabis is legal there and the sky hasn’t fallen (as it were).

  • Mark

    Ok I’m curious,does it go off? I mean surely it must have a pretty good use by date?

    I’m probably missing a few chances at inserting some puns… Long hot day at work LOL.

  • kloyd0306

    Ultra liberal Washington State – so left leaning that they were the only state to vote for Democrat numbskull Michael Dukakis during the Reagan landslide.
    The voters there and in California are probably the most out-of-touch, moronic voters in the USA.

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