U.S. Cannabis Spot Index — February 22, 2019

U.S. Cannabis Spot Index — Published February 22, 2019

U.S. Cannabis Spot Index down 0.7% at $1,153 per pound.

 

The simple average (non-volume weighted) price was nominally unchanged at $1,223 per pound, with 68% of transactions (one standard deviation) in the $414 to $2,031 per pound range. The average reported deal size declined to 3.1 pounds. In grams, the Spot price was $2.54, and the simple average price was $2.70.

 

The relative frequency of trades for indoor flower increased week-over-week, by 2%, while transactions involving greenhouse product saw a decline in this metric of the same proportion. Warehouse flower’s share of the total reported weight moved nationwide shrank slightly this week, by about 1%, with the relative volumes of greenhouse and outdoor product both expanding modestly, by less than 1% each. The relative stability of national Transaction Stats in recent weeks belies their diversity in the major state markets, illustrated below.

The U.S. Spot Index declined by 0.7% this week to settle at $1,153 per pound. The volume-weighted price for indoor flower, which had risen fairly steadily from mid-January, leveled off this week. On a state level, Colorado was the only one of the major Western markets to see an increase in its Spot rate, while Massachusetts was the only other state with a functioning adult-use market to see an increase in its overall going price, and a relatively small one at that. The national composite rate averaged $1,154 per pound for February, off nominally from January’s monthly mean of $1,157 per pound. In 2018, the U.S. Spot Index slipped by 4.8% from January to February, from $1,343 to $1,279 per pound. Of the major and secondary state markets, only prices in Oregon and Nevada are currently displaying behavior at least somewhat similar to observations from the first two months of 2018.    

The national volume-weighted price for flower to be sold in adult-use markets slipped this week on decreases in California, Oregon, Washington, Nevada, and Alaska. Declines in the medical market of Arizona pulled down the national price for product designated for registered patients recorded this week, even as numerous other smaller medical systems saw upticks.        

March 2019 Forward assessed up $50 at $1,150 per pound.

 

The average reported forward deal size decreased to 48 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 56%, 28%, and 16% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 52 pounds, 44 pounds, and 43 pounds, respectively.

 

At $1,150 per pound, the March Forward represents a discount of 0.3% relative to the current U.S. Spot Price of $1,153 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

    Tax Department Data Shows Volume of Flower Sold by Cultivators Increased by 10% in Q4, while Amount of Leaves and Trim Moved by Growers More Than Doubled

  • Colorado

    Denver’s Local Market Likely to See Total Cannabis Sales Decline in 2018 and Account for Smaller Percentage of Statewide Retail Revenues Compared to 2017

  • Oregon

  • Spot Index Sinks to Historic Low for State’s Market, Settling at Less Than $600 Per Pound; State Lawmakers to Discuss Bill That Would Give Regulators Authority to Cease Issuing Cultivation Licenses
  •  
  • Washington

  • Gradual Declines in the Relative Volume of Outdoor Flower Subsequent to 2018’s Fall Harvest Have Contributed to the Recent Rise in the State Spot Index
  •  
  • Arizona

  • Medical Cannabis Sales Decline in January from December’s Record Highs, but Demand Remains Strong Overall as Patient Based Continues to Expand

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

22 February 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — February 22, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published February 22, 2019

The CCSI jumped back up by 7.7% this week to C$6.51/gram, after hitting a low of C$6.04/gram last week. Last week’s price appears to be an anomaly, perhaps due to potentially lower quality and lower priced product changing hands. This week’s price mean reverted back to the 2-month moving average of C$6.45/gram. C$6.51/gram equates to US$2,232/pound at current exchange rates.


This week we dive a bit deeper in the quarterly earnings reports issued by Canopy Growth and Aurora Cannabis.

 

The Health Canada Cannabis Tracking System report gives us complete view of both medical and recreational sales in the last quarter of 2018. From the latest data issued on Jan 29th, a total of 40,753 kg equivalent was sold across Canada with an almost perfect 50/50 split between the medical and recreational markets during this time period.

 

Using this data as a reference point, we calculate the reported Canopy sales volumes of 10,102 kg equivalent for that timeframe for dried cannabis and extracts to be approximately 40% and 9% of the total Canadian recreational and medical markets, respectively. Aurora, the second-largest producer, came in with a smaller market share of 20% of recreational sales, but a substantially larger share of the medical market at 16%.

 

Both producers also gave some insight into their average net selling prices. Canopy’s average net selling price for dried cannabis in the recreational market was slightly higher than our average index price over Q4, while Aurora’s was more comparable to our price assessments. Canopy and Aurora stated their average net selling prices (net of excise duties) to be C$6.96/gram and C$6.23/gram, respectively. The CCSI averaged approximately C$6.32/gram over Q4 2018 (net of the C$1.15 provincial and federal excise duties estimated by Cannabis Benchmarks [$C7.49 less C$1.15]).   

 

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

22 February 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — February 15, 2019

U.S. Cannabis Spot Index — Published February 15, 2019

U.S. Cannabis Spot Index up 1.7% at $1,162 per pound.

 

The simple average (non-volume weighted) price decreased by $25 to $1,223 per pound, with 68% of transactions (one standard deviation) in the $425 to $2,020 per pound range. The average reported deal size was nominally unchanged at 3.2 pounds. In grams, the Spot price was $2.56, and the simple average price was $2.70.


The relative frequency of trades for both indoor and outdoor flower increased week-over-week, by 1% each, while transactions involving greenhouse product saw a 2% decline in this metric. Warehouse flower’s share of the total reported weight moved nationwide grew slightly this week, by 1%, with the relative volume of greenhouse product contracting by the same proportion. Outdoor product is the only grow type to see its relative volume exceed its relative frequency of trades.   

The U.S. Spot Index increased by 1.7% this week to settle at $1,162 per pound. Oregon and Arizona were the only sizeable markets to see downturns in their composite prices this week, which were overwhelmed by increases in the Spot Indices of California, Colorado, Washington State, and Nevada. Smaller markets such as Massachusetts, Michigan, Illinois, and Maine have also applied consistent upward pressure on the national volume-weighted average this year. Based on historical sales data from more mature adult-use markets, January and February are typically months that see lulls in sales compared to the higher-demand months of December and March. While the U.S. Spot Index did dip in the latter weeks of January and the early ones of February, this week’s price is virtually identical to the rate of $1,165 per pound, observed at the outset of the year.  

The national volume-weighted price for flower to be sold in adult-use markets jumped this week, primarily due to rises in California, Colorado, Washington, and Nevada. Declines in the medical markets of Arizona and New Mexico pulled down the national price for product designated for registered patients recorded this week, with assistance decreases in the smaller markets of New Hampshire and Vermont.         

March 2019 Forward unchanged at $1,100 per pound.

 

The average reported forward deal size decreased to 49.3 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 55%, 28%, and 17% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 53 pounds, 45 pounds, and 43 pounds, respectively.

 

At $1,100 per pound, the March Forward represents a discount of 5.3% relative to the current U.S. Spot Price of $1,162 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

    Rising Volume-Weighted Prices for Indoor Flower Persist This Week, Now Up by Almost 7% from Beginning of 2019

  • Colorado

    Monthly Sales Increase in December 2018, Total Retail Revenues Reach $1.54 Billion for Last Year

  • Oregon

  • State Spot Index Drops to Within a Few Dollars of Historic Low Established in October 2018
  •  
  • Washington

  • Notable Homogeneity Observed in Pricing of Individual Wholesale Transactions Across All Grow Types
  •  
  • Michigan

  • State Officials Project About $300 Million in Retail Sales from Medical Cannabis Program in Period from October 2018 through September 2019, But Early Revenue Figures Reported to be Low
  •  
  • Illinois

  • Monthly Cultivator Revenues Reach Record High for State’s Market in January 2019 as State Spot Index Continues to Trend Upward

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

15 February 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved