As Maryland lawmakers head back to Annapolis this week for the start of the 2023 legislative session, they face a laborious task: building out a legal recreational marijuana market. Part of creating that market includes understanding demand for cannabis in the state — and according to a new study, it’s … high.

A House workgroup dedicated to ironing out the details of the forthcoming recreational industry commissioned an outside consulting group, Cannabis Public Policy Consulting, to study adult cannabis use in the state, and offer projections that could help legislators as they figure out what the recreational industry may look like. While the number of Marylanders who reported using cannabis largely mirrored the national average, with around 43% of residents reporting use in the past year, the study found that Marylanders consume marijuana in higher volumes than residents in states with legal weed. While residents of other states average around 20.2 grams per month, Marylanders averaged 25.4. That means the state could expect adults to consume roughly 1.8 million pounds of marijuana in a year.

“That’s actually a pretty big difference,” Michael Sofis, director and researcher with the consulting group told lawmakers last Thursday, speaking of Maryland’s demand compared to other states. “Generally, we did see higher [numbers] particularly in terms of the total volume of the consumer — and what they’re willing to give up, time and money wise. It was really impressive to us.”

The researchers found that Marylanders were willing to travel up to 11-20 minutes to purchase cannabis (about a one-mile walk), and willing to pay $14 per gram, higher than the price in other states, even when accounting for variables like cost of living. Meanwhile, safety was tied with price as residents’ top concerns when purchasing cannabis, while nationally, safety ranks fourth in factors that influence a buyer’s decision.

“Demand was high in Maryland, period. It doesn’t matter if we’re talking money, how willing they were to travel,” Sofis said. “Safety itself being tied for number one is reflective of the kind of demand that is present in Maryland; it’s pretty unique in the sense that there’s such a large overarching demand for cannabis, that price isn’t even necessarily clearly the number one factor that influences their purchasing.”

The study spanned all types of cannabis use and purchase — including medical-use, gifting (or purchasing in the gray market), or buying out-of-state. The high marks point in a promising direction for the state, according to the researchers, and for the future business owners and entrepreneurs that will make up the recreational market once lawmakers lay the groundwork.

Maryland voters overwhelmingly approved recreational marijuana legalization via a ballot referendum last fall, but the legislation (House Bill 837) that the referendum kicked into effect on Jan. 1 stopped short of fleshing out what the market will look like. As of the start of this year, possession of up to 1.5 ounces for adults 21 and over is decriminalized; instead it’s a civil offense punishable by a fine of $100. On July 1, 2023, recreational marijuana will be fully legalized — a tight deadline if lawmakers hope to have some sort of regulatory market set up by that point, and avoid creating a “gray market” scenario, resembling that of D.C.

Recreational marijuana was legalized in the District in 2014, but due to a congressional rider, D.C. can’t tax or make money from its sale. Thus, the city has a gray market of “gifting” vendors, where businesses sell something like a digital print or sticker and provide a free “gift” of marijuana with purchase. (Although, the D.C. Council just passed a creative bill attempting to eliminate the need for such gifting businesses). In Virginia, recreational marijuana possession was rammed through a legislative session in 2021, but the commonwealth has not yet established a market. (Virginia, unlike D.C., prohibits gifting.)

Cannabis Public Policy Consulting researchers recommended Maryland should set a tax rate on marijuana sales between 15-20%, and add at least 300 dispensaries, most of which would exist in Montgomery County (48), Prince George’s County (43), Baltimore County (39), and Anne Arundel County (27). Once the market is open, the study suggested that the state could reach a point where it sees more than $240 million in marijuana sales per month, with a cumulative total of $1 billion in sales in the first 20 months of market operation.

But those dollar signs are all tentative, and hinge upon lawmakers’ legislative agenda in the next weeks and months. What the study did not touch on was how the state should go about distributing licenses — a major failure of the state’s medical marijuana industry launch in 2014. The industry didn’t get off the ground until 2017, and in the first round of licenses, not a single Black-owned businesses secured a license, in a state where Black residents make up nearly a third of the population. (Meanwhile, an American Civil Liberties Union study that assessed marijuana charges from 2010 to 2018 found that Black Marylanders were 2.1 times more likely to be arrested for marijuana possession that white residents, despite national studies showing people of all races use marijuana at similar rates.) Along with the latest demand study from Cannabis Consulting Policy Consulting, the House workgroup has also commissioned a disparity study that will investigate the failures of the medical industry, and guide the creation of a recreational licensing system.

Previously: 
When Will Marylanders Actually See A Market For Legal Weed? It’s Complicated