A recent report indicates that Oklahoma, Oregon, and California are the best-prepared states to benefit from interstate commerce if marijuana is federally legalized. The analysis, conducted by the University of Nevada Las Vegas, highlights that these states have the lowest production costs and high economic potential per capita, setting them apart from other legal cannabis markets.
The white paper was authored by Dr. Robin Goldstein, an economist from the Cannabis Economics Group at the University of California Davis. It argues that cannabis companies capable of producing marijuana at the lowest costs are likely to dominate the market if the federal government removes cannabis from its list of controlled substances. Goldstein emphasized that places where cannabis can be grown and sold inexpensively will likely thrive in national price competition.
Goldstein noted, “The first and biggest effect of interstate commerce will be immediate competition between states on price.” He explained that consumers might be shocked by the price differences between states, such as the contrast between Illinois, where legal cannabis prices can reach $1,500 per pound, and California, where prices drop to $150 per pound for higher THC content. This price disparity could prompt producers in higher-priced states to lobby for protective measures against cheaper out-of-state cannabis.
In his analysis, Goldstein ranked the top 25 states for potential benefits under federal legalization, placing Oklahoma at the top, followed by Oregon and California. He described Oklahoma as “America’s most efficient legal weed system,” with significant long-term growth potential, especially when compared to New York, which he ranked 24th.
Goldstein pointed out that wholesale prices in Oklahoma are declining by about 40% each year, potentially making them the lowest in the nation. He contrasted this with New York’s struggles, stating that its approach to legalization has been a lesson in how not to proceed. While licensed retailers are beginning to emerge in New York, they often sell lower-quality products, while illegal shops provide better options.
Alaska ended up last in the rankings, at 25th place, due to its limited prospects for interstate exports. Goldstein highlighted that California currently boasts the lowest wholesale prices at $150 per pound, significantly lower than Illinois’s lowest price of $1,555 for cannabis. The second-lowest wholesale prices were found in Michigan, according to his report.
