CANNABIS BENCHMARKS WEEKLY REPORT — October 5, 2018

CANNABIS BENCHMARKS WEEKLY REPORT — PUBLISHED October 5, 2018

U.S. Cannabis Spot Index up 0.2% to $1,077 per pound.

 

The simple average (non-volume weighted) price decreased by $7 to $1,255 per pound, with 68% of transactions (one standard deviation) in the $457 to $2,053 per pound range. The average deal size declined 2.6% to 4.2 pounds. In grams, the Spot price was $2.37, and the simple average price was $2.77.

The relative frequency of trades for indoor and outdoor flower both increased this week, by 1% each, resulting in a 2% decline in this metric for deals involving greenhouse product. Both warehouse and greenhouse flower saw their shares of the total reported weight moved nationwide shrink slightly this week, by about 1% each. Correspondingly, the relative volume of outdoor-grown product increased by 2% week-over-week, perhaps signalling the beginning of the fall harvest coming to market.    

The average composite transaction volume contracted again this week, due nearly entirely to a sharp decrease in the mean size of trades for warehouse flower. Meanwhile, the average size of deals for greenhouse product saw its decline slow compared to last week, while that for outdoor flower was on the rise. After four consecutive weeks of declines, the volume-weighted price for indoor product ticked upward this week, and was primarily responsible for boosting the national average, with assistance from marginal increases in the going rates of the other grow types.

The national volume-weighted price for flower to be sold in adult-use markets decreased again this week, as downturns in Colorado, Oregon, and Washington State overwhelmed increases in Nevada, Alaska, and California’s recreational sector. Increases in the Spot Indices of medical-only markets such as Arizona, Michigan, Illinois, and New Mexico lifted the national average for product designated for registered patients.  

April 2019 Forward initially assessed at $1,025 per pound.

 

The average reported forward deal was nominally unchanged at 57 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower represented 48%, 36%, and 16% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 79 pounds, 37 pounds, and 38 pounds, respectively.

 

At $1,000 per pound, the November Forward represents a discount of 7.1% relative to the current U.S. Spot Price of $1,077 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 Slips to Record Low for the State, Falling Below $1,100 Per Pound on Increased Relative Volume of Lower-Priced Outdoor Flower

  • Colorado

  • MED Data Shows Flower Production Outpaced Sales Volume by Over 50% in H1 2018
  • Volume-Weighted Price for Indoor-Grown Product Drops to Historic Low for the State
  •  
  • Oregon

    New All-Time Low Spot Rate for Any Market Established in Oregon for the Third Consecutive Week, As Reported Transaction Stats Indicate Fall Harvest Has Yet to Reach Market

  • Washington

    Volume-Weighted Price for Greenhouse Flower Again Falls to Record Low for the Grow Type in Any Market, Pulling Down Composite Price to a Historic Trough for the State

  • Michigan

  • State Regulators Move Up Deadline for Businesses to Get Licensed or Shut Down, With Existing Product Required to be Liquidated or Destroyed Within 30 Days of Licensure

 Watch our CEO, Jonathan Rubin, in his latest appearance on TD Ameritrade – Morning Trade Live discussing the global cannabis commodity markets and their impact on pot stocks and valuations.

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

3 August 2018.  Copyright © 2018 New Leaf Data Services, LLC.  All rights reserved

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