Two States, Two Trends: Montana’s Expansion Meets Michigan’s Price Pressure

Montana and Michigan highlight two different realities in U.S. cannabis: newer adult-use markets still posting steady growth and mature markets grappling with price compression. New state revenue data out of Montana contrasts with Michigan’s record monthly sales in December amid falling wholesale prices and a new tax taking effect in 2026.

Montana Cannabis Sales Surpass $1B As Rec Market Continues Steady Growth

Recreational cannabis retailers in Montana have surpassed the $1 billion mark in products sold since adult-use sales launched in January 2022.

Data from the Montana Department of Revenue showed that combined medical and adult-use cannabis sales from Jan. 2022 through Dec. 2025 totaled $1.27 billion, with $217 million collected in tax revenue.

Moreover, out of $327 million in combined sales in 2025, 90% came from recreational cannabis sales, resulting in $60 million in tax collections.

The Treasure State has a long history of legal cannabis, starting in 2004 with medical. After voters approved Initiative 190 in November 2020, legal recreational cannabis sales began just over a year later in Montana. According to the latest figures, one of the nation’s newer adult-use markets appears to be demonstrating steady growth.

After initially favoring medical providers, the recreational market has since expanded. However, Montana Senate Bill 27 (SB 27), enacted in 2025, freezes the footprint of the legal marijuana industry in the state. The measure extends a moratorium on issuing new marijuana business licenses for premises until July 1, 2027.

Some of the operators in the state include Sacred Sun Farms, Elevated, Natural Wellness and TopShelf Botanicals.

Michigan Cannabis Sales Climb In December Despite Falling Prices

December was a bright month for Michigan cannabis retailers, with $269.7 million in sales for the month, the highest monthly total recorded in 2025, according to data from the Michigan Cannabis Regulatory Agency. Based on the state’s reported average retail flower price of $58.22 per ounce, that equates to roughly $932 per pound, down about 2.6% from the prior month and nearly 16% from a year earlier, reflecting continued price compression in the state’s mature adult-use market.

However, a newly implemented 24% wholesale excise tax on adult-use cannabis, effective Jan. 1, 2026, is expected to increase consumer prices. The tax is in addition to the existing 10% retail excise tax and 6% state sales tax.

Overall, 2025 saw Michigan recreational cannabis sales drop 3% to $3.17 billion, compared to $3.28 billion in 2024, according to data from Michigan’s Cannabis Regulatory Agency.

Nevertheless, the Great Lakes State remains one of the most competitive and diverse cannabis markets in the U.S., harboring both large multi-state operators (MSOs) and strong in-state operators.