Hacker News Reader

Comment by JeremyBanks | Hacker News Reader

You're misreading. They're not being ordered to destroy crops in order to support the medical marijuana price. They're destroying crops because there was a bubble and they've created way too much supply.

Cannabis stocks were a fad for a while, and I know lots of people who invested in them blindly. The number of legal cannabis retailers is exploding. I live in a mid sized town and there are three more opening this month, and the ones I see always have customers.

The system's hardly failing, some speculators just played themselves.

View on HN

> they're not being ordered to destroy crops in order to support the medical marijuana price.

I didn't say, or suggest, that anyone was ordered to destroy crops?

They created too much supply, yes. Follow the logic chain out a step. If they wanted to sell it, they could lower the price...

Instead they _choose_ to keep the price above the black market price. The black market price which is already inflated far above production cost, by virtue of it being illegal.

Legalization in Canada has dropped unregulated prizes. An 1/8oz (3.5G) pre legalization could fetch $30-$40. Post legalization is maxed at $25. This might not seem like much, but as the weight goes up, it gets drastically cheaper.

You seem to be assuming that the producer/grower and retailer are the same company. There are often disconnects in supply chains like this where someone is hemorrhaging money while others in the chain are doing quite well. And besides if your production costs are high there's a point where lowering the price no longer helps. eg. the cost to package it for retail distribution just adds more even more loss.

TFA references a huge amount of already packaged bud and produced and packaged edibles included in that billion grams.

Unless you’re a cartel trying to price fix for long term gain, selling this stuff at >$0 is a win.

> Follow the logic chain out a step. If they wanted to sell it, they could lower the price...

This is not true about the Canadian market for a couple of reasons. The majority of this overstock cannabis is unpackaged. Unpackaged cannabis cannot be sold outside of licensed producers -> licensed processors.

Reply on news.ycombinator.com