CANNABIS BENCHMARKS WEEKLY REPORT — JULY 27, 2018

CANNABIS BENCHMARKS WEEKLY REPORT — PUBLISHED JULY 27, 2018

U.S. Cannabis Spot Index down 2.7% to $1,115 per pound.

The simple average (non-volume weighted) price decreased by $1 to $1,326 per pound, with 68% of transactions (one standard deviation) in the $562 to $2,091 per pound range. The average deal size increased 5.7% to 5.7 pounds from 5.4 pounds. In grams, the Spot price was $2.46, and the simple average price was $2.92.


The relative frequency of trades for both indoor and outdoor-grown flower declined modestly this week, by less than 1% each, with transactions for greenhouse product increasing in frequency by less than 3%. However, outdoor flower’s share of the total reported weight moved nationally expanded slightly, by nearly 2%, with the corresponding contraction taken entirely from the relative volume of warehouse product. Reports from the field state that light-deprivation harvests are still being cut down and have not yet reached market in large volumes.     

The U.S. Spot Index slid downward for the third week in a row, again establishing a new historic low for the national composite price. Just like last week, the volume-weighted rates of all three grow types saw week-over-week declines. However, apart from a marginal decrease in the average deal size for greenhouse flower, average transaction volumes generally saw notable expansions compared to last week, particularly that for outdoor flower. 

The histogram below shows price dispersion by grow type for July 2018 month-to-date. Noteworthy is that we are now observing some transactions for indoor and greenhouse grown flower at or below $400 per pound. Nearly 60% of outdoor grown flower is now transacting at $600 per pound or less, versus 33% for H1 2018. The amount of greenhouse grown flower selling at $800 per pound or less has essentially doubled to 31% in July, from 16% during H1.

August Forward assessed down $25 to close at $1,175 per pound.

The average forward deal increased over 6 pounds to nearly 71 pounds, driven predominately by cultivators of sungrown flower in Western markets seeking to secure cash flow ahead of the fall harvest. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower represented 44%, 41%, and 15% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 92 pounds, 56 pounds, and 48 pounds, respectively.


At $1,175 per pound, the August Forward represents a premium of 4.8% relative to the current U.S. Spot Price of $1,115 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

Sample headlines from this week’s Premium Report:

California

  • Spot Index Falls to Historic Low for State’s Market, Just One Month After Implementation of New Compliance Requirements


Colorado

  • Consistently Falling Wholesale Rates in Recent Weeks Suggest Market Is Not Concerned By New Compulsory Pesticide Testing of Flower and Trim That Begins August 1st  


Oregon

  • Less than 1% of Reported Volume Traded in Each of Last Two Weeks Moved for $2,000 Per Pound or Above


Washington

  • State Spot Index and Volume-Weighted Rates for All Three Grow Types Fall to New Historic Lows for Any Market; This Week’s Composite Price Nearing $650 Per Pound


Massachusetts

  • Medical Cannabis Patient Count and Sales Volume Expand in June as Wait for the Beginning of Adult-Use Sales Continues

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

20 July 2018.  Copyright © 2018 New Leaf Data Services, LLC.  All rights reserved

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