CANADA CANNABIS SPOT INDEX — March 29, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published March 29, 2019

The CCSI dropped this week by 2.3% to C$6.96 per gram, from last week’s C$7.12 per gram. This week’s price of C$6.96 per gram equates to US$2,356 per pound at current exchange rates.


This week we once again turn to the Cannabis Tracking System report issued by the Government of Canada. With the addition of January data, we see that Canadian sales have been relatively stable since legalization, averaging about 7,070 Kg sold monthly in the non-medical and medical markets. In the five months of data available, non-medical sales have averaged 5,258 Kg across Canada. Non-medical sales are about three times higher than medical sales.

Total finished inventory, which is inventory that is packaged and labelled, sits at 19,520 Kg as of the end of January. This is unsold product stored at the licensed producer’s (LP) facility, or at an  online distribution or retail storefront location, as reflected in the chart below. This inventory equates to 2.7 months worth of sales at current rates [19,520 / 7,069 kg].

Total unfinished inventory, which is inventory that is NOT packaged and labelled for retail sale, sits at 114,628 Kg as of the end of January. This inventory equates to 16.2 months worth of sales at current rates [114,628 / 7,069 kg].

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

29 March 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — March 29, 2019

U.S. Cannabis Spot Index — Published March 29, 2019

U.S. Cannabis Spot Index up 1.2% to $1,087 per pound.

 

The simple average (non-volume weighted) price increased more than $5 to $1,117 per pound, with 68% of transactions (one standard deviation) in the $385 to $1,850 per pound range. The average reported deal size declined to 2.7 pounds. In grams, the Spot price was $2.40 and the simple average price was $2.46.

 

The relative frequency of trades for greenhouse flower decreased week-over-week by 1%. The relative frequency of transactions involving outdoor product increased by the same proportion, while that for indoor flower was flat. Warehouse product’s share of the total reported weight moved nationwide increased by 2% compared to last week. The relative volumes of both greenhouse and outdoor flower each decreased week-over-week by 1%.

The U.S. Spot Index reversed a sustained decline this week, ticking upward by 1.2% to settle at $1,087 per pound. The national composite rate rose on an increase in the volume-weighted price for indoor flower, as well as an expansion in that grow type’s relative volume. The U.S. rate for warehouse product is being pushed up by rising prices in the mid-sized medical markets of Illinois, Maine, Michigan, and New Mexico; of the four major Western markets only Washington saw prices for indoor flower increase this week. Expanding patient counts and demand in the first and final medical markets just listed have been driving prices in those states upward, while shifting regulatory landscapes in Michigan and Maine have resulted in uncertainty for participants in those markets.

The histograms below show price dispersion by grow type for March 2019 versus March 2018. Most notably, nearly 80% of outdoor transactions were priced above $600 per pound last year, whereas nearly 85% are currently priced below $600. Additionally, expansion of greenhouse capacity in higher priced markets such as Nevada (compared to West Coast markets) helped increase the proportion of greenhouse transactions priced above $1,000 per pound from 34% to 43%.   

April 2019 Forward closes unchanged at $1,075 per pound.

 

The average reported forward deal size declined to 46 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 59%, 28%, and 13% of forward arrangements, respectively. The average forward deal size for monthly delivery for outdoor, greenhouse, and indoor-grown flower was 44 pounds, 48 pounds, and 44 pounds, respectively.

 

At $1,075 per pound, the April Forward represents a discount of 1.1% relative to the current U.S. Spot Price of $1,087 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

    Over 300 Annual and Provisional Cultivation Licenses Issued Between Late February and March 22nd, But 3,450 Listed as “About to Expire” as of Last Week

  • Colorado

    Taxes on Flower Transferred Internally by Vertically-Integrated Adult-Use Operations Will Rise by Over 3% in Q2, the Second Consecutive Quarter to See an Increase

  • Oregon

  • Retail Demand Slides in February for Second Consecutive Month, as Spot Index Fell to a Historic Low for the State’s Market
  •  
  • Washington

  • LCB Canopy Report Shows that Growers are Not Fully Utilizing Allowed Production Capacity, Large Operations Hold Outsized Market Share
  •  
  • Nevada

  • State Spot Index Again Drops Sharply, Establishing New Historic Low for the Market for the Second Straight Week
  •  
  • Michigan

  • Unlicensed Dispensaries That Account for Almost Half of Operational Storefronts in the State to be Compelled to Close at End of March, Reducing Wholesale Demand

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

29 March 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — March 22, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published March 22, 2019

The CCSI moved higher by 1.6% this week to C$7.12 per gram, from last week’s C$7.01 per gram. The CCSI has been quite stable over the past three weeks, hovering within a C$0.11 range. This week’s price of C$7.12 per gram equates to US$2,421 per pound at current exchange rates.


This week we focus in on the size of the Canadian cannabis market. The Government of Canada did a national cannabis survey to assess the number of people using cannabis in Q4 2018. The survey estimates cannabis use of all citizens over the age of 15 by age, location, and gender. The potential size of this market is roughly 29.3M citizens.

Based on the survey, approximately 4.63M people or 15.8% of Canadians aged 15+ reported cannabis use. Males were more likely to use cannabis with 20.1% reporting use, as compared to only 11.4% of females.

Looking at cannabis use by age, the 18 to 24 year old population was most likely to use with 28.1% having used cannabis in the last quarter of the year. The 25 to 44 age group was the second most likely age group to use with 23.1%.

Lastly, the same data was broken out by province. The four largest provinces – Ontario, Quebec, British Columbia, and Alberta – showed total usage around 13.6% of the population. The four maritime provinces – Nova Scotia, New Brunswick, Newfoundland, and Prince Edward Island – showed higher usage with 15.7% of the population in those provinces reporting cannabis use.

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

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