Black market suffering as legal cannabis takes over

Black+market+suffering+as+legal+cannabis+takes+over

Ashtyn Mann, Staff Reporter

The legalization of recreational marijuana in Washington state may eventually force some illegal street dealers to go legit, says one Seattle dealer.

For now, legalization appears to be a blessing for illegal street sales.

“I think [marijuana] is a lot easier to sell illegally now because legal marijuana is so expensive and people want it cheaper,” said the dealer, who gave his name as Jay.

“However, it might be short-lived if prices of retail weed drop in the future.”

Prices already dropping

Rick James, a 23-year-old part-time street dealer and full-time head gardener at Green Labs LLC in Raymond, Wash., said that the legalization of retail and medical marijuana has drastically decreased the price of cannabis.

James said at the height of his time as an illegal salesman, a pound of cannabis was worth $2,800 for the best available product. Now, James said, you’re lucky to see a pound worth $2,000. That’s a 28 percent decrease in only a few years.

As a result, James has turned to selling legal medical marijuana.

“I only sell cannabis that I produced myself legally under medical cannabis laws,” James said. “Which results in higher profit per sale, but less overall sales.”

Legal prices still high

James said Green Labs, a legal grower and processor, produces about 70 pounds of legal recreational cannabis every month, selling it for $4,500 to $5,000 per pound.

That’s more expensive than illegal street prices, largely because of taxes and costs that illegal growers and processors don’t face.

At recreational marijuana shops, higher prices don’t seem to be deterring wealthy customers.

“What surprised me about the retail shop I visited was that there were a lot of middle-aged men buying weed. All different types of people, too,” said Kevin Schwend, a 24-year-old office assistant and marijuana retail customer from Woodinville, Wash.

“There were businessmen with Bluetooth devices in their ears chatting away, and there were also the more stereotypical old hippies as well,” Schwend said.

Quality is rising

Despite the drop in prices, quality has skyrocketed.

“The weed is definitely better quality because now people can buy really good quality for cheap from medical patients who are allowed to grow,” Jay said. “Everyone is getting better at growing it because the way the market is developing.”

Schwend said the quality of the weed that retailers sell is consistently better than street weed. However, he said the quality of the illegal weed also has gotten noticeably better since legalization.

Better quality equals better sales, Jay said.

“Weed is definitely stronger now,” Jay said. “The more you smoke, the stronger you need, so the sales increase.”

Everyday low prices

The customer base has increased for street dealers since retail marijuana became a factor, Jay said. In fact, he said he returned to illegal selling after a break.

“If anything, [legalization] has made street selling more lucrative because people are wanting cheaper weed: supply and demand,” Jay said. “People don’t want to pay twice when they can pay half. Why would you go to Safeway when you could shop at Costco?”

Street-side, Jay said he sells to, among others, coworkers and managers of all ages who work at the high-class restaurant where he works as a waiter as a side job.

Future for illegal business

According to Jay, as marijuana retailers continue to drop their prices illegal dealers must lower their own prices or convert to legal operations.

“Eventually, the retailers will start charging street prices,” Jay said. “I think street dealers will slowly diminish as it gets cheaper.”

Jay said he is planning on converting to legal selling as soon as he gets his medical card because it allows him to have the same amount of weed on him at all times and sell it legally to medical customers.

James believes he will have to convert his business to 100 percent legal to keep his head above water.

“I see myself having to find a way into the legal market or be pushed out entirely within the next five years here in Washington state,” James said.