U.S. Cannabis Spot Index — November 8, 2019

U.S. Cannabis Spot Index — Published November 8, 2019

U.S. Cannabis Spot Index down 0.5% to $1,452 per pound.

 

The simple average (non-volume weighted) price declined $10 to $1,653 per pound, with 68% of transactions (one standard deviation) in the $979 to $2,327 per pound range. The average reported deal size increased to 2.2 pounds. In grams, the Spot price was $3.20 and the simple average price was $3.64.

 

The relative frequency of trades for indoor flower decreased by about 3% this week. The relative frequency of deals for greenhouse product increased by the same proportion, while that for outdoor flower was unchanged.

The U.S. Spot Index declined by 0.5% this week to settle at $1,452 per pound. This is only the second decrease in the weekly national composite price to be observed since the beginning of September. 

 

Previously, November has typically been the month in which the lowest monthly average Spot price of any given year has been documented. That trend that will almost certainly be disrupted this year even if a downward trend manifests going forward. Two weeks into this month, November’s month-to-date average composite rate is $1,456 per pound, the highest so far for 2019 and up by 1.7% from October. 

 

In 2018, the monthly average U.S. Spot was essentially flat from October to November, when it declined slightly from $1,076 to $1,075 per pound. Last year, weekly prices generally trended downward from early September through mid-November, before recovering to close 2018. The U.S. Spot rose by 12.2% from this point in 2018 to the end of last year.    

As we noted last week, positive trends in wholesale prices in the four major Western markets have in most cases subsided or been reversed recently. If such trends continue, then it is possible that the end-of-year price recovery that has been observed on numerous previous occasions may be absent this year.

The national volume-weighted price for flower to be sold to general consumers inched upward marginally this week. The slight rise was due entirely to an uptick in wholesale prices in Washington State, as every other state with a functioning adult-use system saw declines.   

 

The national price for medical flower sank this week. As noted above, most of the states covered by our reporting experienced decreasing wholesale prices this week, with markets such as Arizona and Illinois seeing notable declines in their Spot prices.  

December Forward unchanged at $1,450 per pound.

 

The average reported forward deal size decreased to 50 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 50%, 35%, and 15% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 50 pounds, 42 pounds, and 61 pounds, respectively.

 

At $1,450 per pound, the December Forward represents a discount of 0.2% relative to the current U.S. Spot Price of $1,452 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Headlines From This Week’s Premium Report:

  • California

  • Prices for Greenhouse and Outdoor Flower Remain Strong this Harvest Season, With Both Rising to New Annual Highs this Week
  •  
  • Colorado

    Announcement that Columbia Care is Acquiring The Green Solution Provides Insight into Market Share of One of State’s Largest Chains

  • Oregon

  • State Spot Index Declines for Second Straight Week; Prices for Greenhouse and Outdoor Flower Have Been Decreasing for Four Consecutive Weeks
  •  
  • Washington

  • Composite Price Has Trended Upward Slightly So Far in Q4
  •  
  • Massachusetts

  • Monthly Adult-Use Sales Decline for the First Time in September as Ban on Vape Products was Implemented Late that Month 

Are you a licensed market participant in the U.S. or Canada? 

Do you support wholesale market transparency?

Become a member of our Price Contributor Network and receive discounted pricing and exclusive analysis!

Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

8 November 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — November 1, 2019

U.S. Cannabis Spot Index — Published November 1, 2019

U.S. Cannabis Spot Index up 0.1% to $1,460 per pound. The simple average (non-volume weighted) price was nominally unchanged at $1,663 per pound, with 68% of transactions (one standard deviation) in the $976 to $2,350 per pound range. The average reported deal size increased to 2.1 pounds. In grams, the Spot price was $3.22 and the simple average price was $3.67.

 

The relative frequency of trades for indoor flower decreased by over 1% this week. The relative frequency of deals for outdoor product increased by the same proportion, while that for greenhouse flower was unchanged.

The U.S. Spot Index rose by $1 this week to settle at $1,460 per pound. This is the third consecutive week that the national composite price has established a new annual peak. Yet, the marginal increase documented this week, along with the behavior of wholesale rates at the state level, suggests that the downturn in prices seen customarily at this time of year may yet be in the offing.  

 

California’s Spot saw a significant uptick this week on the back of increases in rates for greenhouse and outdoor product. However, while price trends in the four major Western markets have all generally been on the upswing since this summer, some divergences began to be observed this week. Most notably, the strong, steady climb of Oregon’s Spot was interrupted by a significant decline this week. Meanwhile, positive movement in wholesale rates in Colorado and Washington has leveled off in recent weeks. 

 

Whether the departures from uniformly upward movement in wholesale prices in the major markets will persist remains to be seen. Even as the fall harvest begins to make its way to market in earnest in the weeks ahead, the approach of the Thanksgiving holiday means that wholesale demand will likely increase at the same time. As those who have observed the legal cannabis industry in recent years are aware, retailers now traditionally run “Green Friday” specials on the day after Thanksgiving and so will look to have larger volumes of product on hand to accommodate consumers looking to take advantage of sales and promotions.

The national volume-weighted price for flower to be sold to general consumers declined slightly this week. The downturn was due mainly to a significant drop in wholesale rates in Oregon, although Colorado also saw a small decrease in the price for flower in its adult-use sector.  

 

The national price for medical flower continued its overall upward trend of the past six weeks. A rise in that sector of the market in California, along with upticks in Maine, Massachusetts, Michigan, New Mexico, Rhode Island, and Vermont pushed up the national rate for medical product.

May 2020 Forward initially assessed at $1,455 per pound.

 

The average reported forward deal size increased to 51 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 48%, 36%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 53 pounds, 42 pounds, and 61 pounds, respectively.

 

At $1,450 per pound, the December Forward represents a discount of 0.7% relative to the current U.S. Spot Price of $1,460 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Headlines From This Week’s Premium Report:

  • California

  • Prices for Greenhouse & Outdoor Flower Rise to New Annual Peaks, While Rates for Indoor Product Have Slumped in Recent Weeks
  •  
  • Colorado

    State Spot Index Has Plateaued in Recent Weeks, but Reports of Widespread Mold and Yeast Contamination Found in Products at Denver Retailers May Impact Market

  • Oregon

  • Composite Price Experiences its Largest Week-Over-Week Decline of 2019 After Climbing Consistently Since April
  •  
  • Washington

  • Outdoor Flower Prices Continue to Ascend, Up Over 20% From First Week of October
  •  
  • Nevada

  • Total Retail Sales and Those in Adult-Use Market Both Rise to New Record Highs in August, but Exceed Previous Peaks by Only Small Margins

Are you a licensed market participant in the U.S. or Canada? 

Do you support wholesale market transparency?

Become a member of our Price Contributor Network and receive discounted pricing and exclusive analysis!

Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

1 November 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — October 25, 2019

U.S. Cannabis Spot Index — Published October 25, 2019

U.S. Cannabis Spot Index up 2.0% to $1,459 per pound.

 

The simple average (non-volume weighted) price increased $49 to $1,663 per pound, with 68% of transactions (one standard deviation) in the $969 to $2,356 per pound range. The average reported deal size was nominally unchanged at 2.0 pounds. In grams, the Spot price was $3.22 and the simple average price was $3.67.

 

The relative frequency of trades for indoor flower increased by 1% this week. The relative frequency of deals for outdoor product decreased by the same proportion, while that for greenhouse flower was unchanged. Greenhouse product’s share of the total documented weight moved nationally expanded by 1% this week. The relative volume of outdoor flower contracted by the same proportion, while that for warehouse product was stable.

The U.S. Spot Index rose by 2% this week to settle at $1,459 per pound. This is the fifth time in the last six weeks that the national composite price has established a new annual peak. As we noted last week, at this time last year the U.S. Spot began a noticeable descent and eventually reached its annual trough in the second week of November. The national monthly average composite rate for November has typically been the lowest observed in any given year since Cannabis Benchmarks® began assessing prices in 2015. 

 

In addition to the current behavior of national wholesale cannabis prices, several factors indicate that this year’s harvest season could see significant disruption in historical trends. Growing conditions in the Pacific Northwest states have not been favorable this year. As we expand upon in the commentary for Oregon, one veteran cultivator in that state expects the autumn harvest to have a “subtle” impact on prices. Apprehensions about Colorado’s largest grower losing a significant portion of its outdoor crop to an early freeze could amplify the existing upward trend in prices in that state. This despite the possibility that the loss represents a relatively small proportion of the state’s total production, as we discuss below, although uncertainty on that front will not be clarified until official data is available next year. 

 

Meanwhile, Spot rates in the mid-sized markets of Michigan, Massachusetts, and Illinois continue to rise, providing positive pressure to the U.S. Spot not present in prior years in such a sustained manner.

The national volume-weighted price for flower to be sold to general consumers rose this week. Apart from Nevada, every state market in which adult-use sales are currently taking place saw an uptick in prices for such flower, although rates in Massachusetts’ adult-use sector were flat this week. 

 

The national price for medical flower declined slightly this week, due virtually entirely to a downturn in that portion of California’s market.

November Forward closes up $100 to $1,425 per pound. The average reported forward deal size declined to 50 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 49%, 35%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 53 pounds, 39 pounds, and 61 pounds, respectively.

 

At $1,425 per pound, the November Forward represents a discount of 2.3% relative to the current U.S. Spot Price of $1,459 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Headlines From This Week’s Premium Report:

  • California

  • Price for Outdoor Flower Ascends to New Annual Peak this Week; Rates for Indoor Product Down 7.5% in Last Two Weeks
  •  
  • Colorado

    How Much of Colorado’s Statewide Production Was Actually Impacted by Recent Partial Crop Loss at Los Sueños Farms?

  • Oregon

  • Veteran Outdoor Grower in Southern Oregon Expects This Year’s Fall Harvest to Have a “Subtle” Influence on Wholesale Prices
  •  
  • Michigan

  • Official Sales Data for Q2 Indicates Available Supply Increased in the Period, but Not Enough to Prevent Price Rises
  •  
  • Illinois

  • Local Governments of Chicago and Aurora Approve Regulations for Adult-Use Retailers

Are you a licensed market participant in the U.S. or Canada? 

Do you support wholesale market transparency?

Become a member of our Price Contributor Network and receive discounted pricing and exclusive analysis!

Cannabis Benchmarks®, a division of New Leaf Data Services, LLC

25 October 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved