Michigan marijuana growers plan to keep competition out of market

Michigan's largest marijuana operators are plotting an offensive to keep competitors out of the market as weed prices plummet, according to Crain s Detroit.

The Legislative Service Bureau has drawn up new legislation to prevent the Michigan Cannabis Regulatory Agency from approving new grower licenses, according to Crain s, at the request of a lobbyist for some of the state's largest growers.

The proposal calls for a moratorium on licenses for an undetermined period of time.

A source said the draft legislation has no legislative sponsors yet, but is expected to be introduced after the November election. It is not clear whether the language in the legislation will make the final bill.

The cannabis industry is struggling with falling prices, oversupply and limited retail outlets. It seems that investors are getting spooked. The pressure is on regulators to get rid of the competition.

New markets are moving quickly, especially in Michigan, where there is no limit on business licenses, because of the low, or lower, of wholesale recreational weed in Michigan.

Small growers complain that they're being consumed by large corporate firms in a race to the bottom, according to MLive in late summer. It seems that everyone is joining the race to the bottom.

There is a deadly atmosphere for all involved, due to the slim margins, too much product and not enough places to sell it, and the fact that municipalities can opt out of allowing cannabis shops to operate. The state's largest city, Detroit, only began accepting applications for retail outlets in mid-September.

Lance Boldrey, partner at Detroit-based law firm Dykema Gossett PLLC, told Crain's in August that nobody is making a lot of money and many are losing money. We are seeing a lot of consolidation out of necessity. We expected that as the industry matured, but now it's been here a while it's just tough.