U.S. Cannabis Spot Index — June 14, 2019

U.S. Cannabis Spot Index — Published June 14, 2019

U.S. Cannabis Spot Index up 0.4% to $1,256 per pound.

 

The simple average (non-volume weighted) price increased $13 to $1,445 per pound, with 68% of transactions (one standard deviation) in the $619 to $2,270 per pound range. The average reported deal size increased to 2.7 pounds from 2.6 pounds last week. In grams, the Spot price was $2.77 and the simple average price was $3.18.

 

The relative frequency of trades for outdoor flower increased by 2% week-over-week. The relative frequency of transactions involving greenhouse product decreased by the same proportion, while that for deals for indoor flower was unchanged. Outdoor product’s share of the total documented weight moved nationally also expanded by 2% this week. The relative volume of greenhouse flower contracted by the same proportion, while that for warehouse flower was unchanged.   

 

The U.S. Spot Index rose by 0.4% this week to settle at $1,256 per pound, establishing a new year-to-date peak for the fourth consecutive week. All four of the major Western markets – California, Colorado, Oregon, and Washington – saw upticks in their composite prices this week. Positive trends in rates for outdoor flower in California and Oregon continued to lift the Spot Indices of those states, while volume-weighted prices for greenhouse product in Colorado and Washington rose to year-to-date highs. In contrast to last year at this time, upward price pressure on the national average is also originating from Massachusetts, Michigan, and Nevada. Massachusetts’ young adult-use market generated over $30 million in retail sales in both April and May, as we expand upon further below, after opening in late November last year. 

The national volume-weighted price for flower to be sold to general consumers jumped this week on increases in every functioning adult-use market except for Nevada, which saw only a slight decrease. Prices for medical flower were down this week, mainly on declines in California and Arizona.

July Forward assessed up $75 to $1,200 per pound.

 

The average reported forward deal size was 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 sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 41 pounds, 51 pounds, and 64 pounds, respectively.

 

At $1,200 per pound, the July Forward represents a discount of 4.4% relative to the current U.S. Spot Price of $1,256 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

  • Monthly Average Prices in Adult-Use Sector Declined in each Month from January through May, But Weekly Rates for Recreational Flower Are on the Rise Recently
  •  
  • Colorado

    Retail Sales Declined in April, While State Spot Index Stabilized to Close the Month After Early Declines

  • Oregon

  • State Spot Index Jumps to New Annual Peak, Settling Above $700 Per Pound for First Time in 2019
  •  
  • Washington

  • Composite Price Climbs to Year-to-Date High on Rising Rates for Indoor and Greenhouse Flower
  •  
  • Massachusetts

  • Adult-Use Retail Demand and Production Both Increased Significantly in May, as Wholesale Prices Declined by Small Margins
  •  
  • Illinois

  • Retail Medical Cannabis Sales Reached New Record High for Fourth Straight Month in May, Up by Almost 90% Year-Over-Year

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

14 June 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — June 14, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published June 14, 2019

*The provincial excise taxes vary. Cannabis Benchmarks estimates the population weighted average excise tax for Canada.

**CCSI is inclusive of the estimated Federal & Provincial cannabis excise taxes..

The CCSI was assessed at C$7.24 per gram this week, up 6.2% from last week’s C$6.81 per gram. This week’s price equates to US$2,466 per pound at current exchange rates.

 

This week we look at sales, tax revenue, and market dynamics in Quebec in the province’s first fiscal year of legal cannabis.

Quebec is the only large Canadian province that has kept a tight grip over cannabis sales, with its primary goal of ensuring safe consumption while minimizing the illicit market. The Quebec government mandated the Société des alcools du Québec (SAQ) to set up the Société québécoise du cannabis (SQDC) to bring legal cannabis to the market. Similar to Oregon and Washington State in the U.S., the province’s regulatory body overseeing alcohol was expanded to provide oversight of cannabis as well. The SQDC was established on June 12, 2018, ahead of legalization. Its first fiscal year of operation ended on March 30, 2019.

 

SQDC launched an online store and 12 brick and mortar locations in Quebec starting in October. With supply challenges looming at the onset of legalization, the SQDC dramatically cut store hours and slowed expansion plans. Since then the supply issues have been overcome and stores are now open seven days a week with a 13th store opened in March. The Crown corporation signed leases for three more locations in Montreal, the Laurentians, and the Montérégie.

 

SQDC reported robust sales figures despite some issues upfront. A total of C$71M in sales were tallied in the first fiscal year that ended at the close of March, with in-store sales making up roughly 81% of the sales and volume sold. The 12 locations also processed approximately 1.3M transactions with an average spend of C$51.07. Online sales were not as robust with 257,000 transactions that generated an average spend of C$61.06.

 

For this past fiscal year, the SQDC reported a balanced year when excluding C$4.9M of non-recurring start-up costs. The Quebec government received C$29.7M in consumption and excise taxes from this new industry. For the 2019-2020 fiscal year, the SQDC is projecting significantly higher earnings of C$20M with the province taking in C$89M in consumption and excise taxes.

*The provincial excise taxes vary. Cannabis Benchmarks estimates the population weighted average excise tax for Canada.

**CCSI is inclusive of the estimated Federal & Provincial cannabis excise taxes..

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

14 June 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — June 7, 2019

U.S. Cannabis Spot Index — Published June 7, 2019

U.S. Cannabis Spot Index up 1.5% to $1,251 per pound.

 

The simple average (non-volume weighted) price increased $42 to $1,431 per pound, with 68% of transactions (one standard deviation) in the $617 to $2,246 per pound range. The average reported deal size declined to 2.6 pounds from 2.8 pounds last week. In grams, the Spot price was $2.76 and the simple average price was $3.16.

 

The relative frequency of trades for indoor flower increased by over 1% week-over-week. The relative frequency of transactions involving greenhouse product decreased by the same proportion, while that for deals for outdoor flower was unchanged. Greenhouse flower’s share of the total documented weight moved nationally expanded by almost 5% this week. The relative volumes of warehouse and outdoor product contracted by about 4% and 1%, respectively, compared to last week.

 

The U.S. Spot Index rose by 1.5% this week to settle at $1,251 per pound, establishing a new year-to-date peak for the third consecutive week. Additionally, this week is the first time in 2019 that the national composite price has been up relative to a year ago, when it settled at $1,237 per pound in the opening week of June. While the large adult-use markets have garnered much of our attention, numerous medical markets – such as in Illinois, Rhode Island, and Connecticut – have seen growing patient counts and demand push up wholesale rates. Meanwhile, prices have also been on the rise in other mid-sized markets such as Massachusetts, Michigan, and Maine, due to the opening of adult-use sales in the former case and the implementation of new regulatory structures in the latter two.  

The national volume-weighted price for flower to be sold to general consumers jumped this week on increases in every functioning adult-use market except for Colorado. Prices for medical flower were up slightly this week. Declines in California and Arizona dampened increases observed in every other medical market covered in our reporting.

December Forward initially assessed at $1,065 per pound.

 

The average reported forward deal size was 47 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 56%, 29%, and 15% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 41 pounds, 51 pounds, and 65 pounds, respectively.

 

Implied Forward Prices for July and August have been assessed upward, as can be seen in the table below. Historical sales trends in the more mature adult-use markets show that demand increases as the summer months wear on. Furthermore, wholesale buyers in Oregon and Washington have recently begun to show a willingness to pay higher prices, perhaps due to crops harvested in previous years losing their appeal. Finally, California’s supply chain appears to be undergoing a turbulent period and is losing production capacity, but the market landscape could settle by late summer or early autumn.

 

At $1,125 per pound, the July Forward represents a discount of 10.1% relative to the current U.S. Spot Price of $1,251 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

  • State Spot Index Rises to New Annual Peak as Prices in Adult-Use Sector Spike by Over 20%
  •  
  • Colorado

    Wholesale Prices Trending Downward Gradually, as Other Major Adult-Use Markets See Upticks in Rates

  • Oregon

  • Monthly Average Price for May Up by 16% from April, With Upward Movement Continuing to Open June
  •  
  • Washington

  • State Spot Index Has Stabilized Since Mid-May, After Rising from Outset of 2019
  •  
  • Nevada

  • Retail Sales Up Over 20% Month-Over-Month in March to Set New Record for State’s Market, First Major Increase in Monthly Revenue in a Year

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

7 June 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — June 7, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published June 7, 2019

*The provincial excise taxes vary. Cannabis Benchmarks estimates the population weighted average excise tax for Canada.

**CCSI is inclusive of the estimated Federal & Provincial cannabis excise taxes..

The CCSI came in at C$6.81 per gram this week, from last week’s C$7.96 per gram. This week’s price equates to US$2,301 per pound at current exchange rates.

 

The AGLC, the Government of Alberta’s Crown agency that oversees the gaming, liquor and cannabis industries in Alberta, lifted the province’s retail cannabis license moratorium. The bulletin, which was published on May 30th, indicated that with the “steady increase” in supply the AGLC is once again in a position to issue five licences a week. AGLC currently has contracts with 26 licensed producers (LPs) and 111 licensed retail outlets.


Alberta is the fourth largest province with approximately 553,000 cannabis users according to a survey conducted by Statistics Canada. Statistics Canada also reports on retail sales for each province. With the limited supply of retail outlets, retail sales in Alberta have flatlined through Q1 2019 at approximately C$450,000 per day. The addition of new storefronts should help the development of the legal cannabis market by providing convenient access to customers that currently purchase from the illicit market.

 

Cannabis Benchmarks also analyzed the state of the AGLC-run online store. The online store shows 76% of 249 dried flower products available, 49% of 53 pre-rolled products available, and 85% of the oils available.

 

After taking this step forward to provide additional access to the cannabis industry, AGLS plans to closely monitor supply to ensure that existing and new retailers have access to consistent deliveries of product.

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

7 June 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved