People need to take a step back and why pot was legalized in the first place. One of the reasons was that criminalizing pot was meant to suppress use. Four decades of widespread use proved that was a failed strategy - virtually everyone in Canada in 2012 who wanted to smoke pot could smoke pot.
Of course people who are occasional users who have to buy from a guy who knows a guy found it inconvenient. And those are the people who will benefit most from legalization. But long-term heavy users had regular and trusted suppliers. They get all the pot they need at a good price and with no stress today. They aren't buying from a guy parked outside the French Maid. They're buying from their friends. People on their hockey teams. Their neighbours. And they're often buying in large volume, so it's cheap.
And keep in mind that the dispensaries that are selling pot today in the mail are operating illegally, and the government plans to shut them down. When legal retail comes on-stream it will be more expensive than these mail dispensaries.
Legalization of marijuana unlikely to kill Canada’s black market right away
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...“There’s a huge, complex system out there operating in the world that has been delivering excellent product to people at reasonable prices for 40 years now,” says Donald MacPherson, the executive director of the Canadian Drug Policy Coalition, an organization based out of Simon Fraser University that advocates for evidence-based policy-making and harm-reduction strategies.
“It’s really the degree to which the regulated system can, over a period of years, encroach on as much of that pre-existing market as possible – that is the key question.”
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Cannabis producers skeptical of whether Ontario’s plan can compete with black market
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...He went on to say that because of the expected pricing at $10 per gram, and the lack of variety in the products offered by LCBO-run stores, regular cannabis users are more likely to continue getting their products on the black market, where they always have.
“It really will depend on how it rolls out. It will take longer to tackle or put a dent in the black market given the proposed distribution,” Zavet said.
“The amount of stores is not going to be enough, it’s not going to be convenient for people. There’s still going to be a lot of product in the grey area that people are not licensed to grow and not licensed to distribute.”
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Federal government targets black – and grey – markets with legal cannabis
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Ms. Petitpas Taylor said the illegal market for cannabis will not disappear with the flick of a switch, but that everyone should work together to better protect young Canadians and remove criminal elements from the production chain.
"The system is not going to be perfect in July, 2018," she said. "With respect to the black market, we certainly want to make a dent in it. Do we think it will happen overnight? Absolutely not."
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Why Ontario’s pot plan will keep the black market alive
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...The price and taxation of legal marijuana is another important component of stamping out illicit sales, and that still has to be determined. Finding a balance will be challenging. If the price is too low, governments will be seen as encouraging people to take up pot. Too high, and users will stick to illicit sources. The regulatory and operating costs of the country’s existing licensed producers add to the price of marijuana compared to illicit growers, and the Ontario government’s proposed retail model comes with its own set of costs. Private operators, in contrast, compete with one another and have a built-in incentive to keep prices and costs low.
If governments compete on price, illegal growers and retailers could respond by dropping their own prices. “The illicit market will protect its share,” says Chris Damas, editor of an investment newsletter called the BCMI Report, which analyzes marijuana stocks. The quality of cannabis from illicit producers is just as good—if not better—than what licensed producers are offering, he says, presenting another challenge. Damas estimates about half of illicit sales at most will move to legal channels within the first year.
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