CANADA CANNABIS SPOT INDEX — April 19, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published April 19, 2019

The CCSI moved lower by 5.9% to C$6.69 per gram, from last week’s C$7.11 per gram. This week’s price equates to US$2,272 per pound at current exchange rates.

 

This week Health Canada released their preliminary summary of February sales data from the Cannabis Tracking System. In our analysis below, we focus on sales of non-medical dry cannabis and oil, which have proven to be weaker than anticipated. In the last month many provinces have restated their cannabis revenue projections for 2019, adjusting them downward due to a flourishing black market with lower prices and more product variety.

 

The reports are labelled as preliminary, therefore data from the past months are adjusted with each release. In the most recent report, January sales for non-medical dry cannabis were restated higher by 8 kg/day, resulting in average daily sales of 179 kg for the month. Preliminary February sales figures came closely in line with both December and January at 178 kg/d.

Also in the most recent report, January sales of cannabis oil were restated higher by 2 litres/d, for an average daily sales of 95 litres. February sales figures came slightly lower than January at 91 litres/d.

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

19 April 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — April 12, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published April 12, 2019

The CCSI moved higher by 2.5% to C$7.11 per gram, from last week’s C$6.94 per gram. This week’s price equates to US$2,418 per pound at current exchange rates.

 

The hype around cannabis legalization and the tax revenues that would pour into federal and provincial coffers seems to be slowly fading. Several provinces are restating their future revenue projections from this highly publicized new source of tax revenue.

 

The Ontario budget, released on Thursday, gave some new insight into the current state of the legal cannabis market in the province. Ontario, with 38% of the country’s population and an estimated 1.8 million cannabis users, cut their projected revenue from cannabis excise taxes to C$80 million from C$115 million for the 2019-2020 fiscal year. The cut reflects a black market still thriving due to volatile supply, limited retail locations, and higher than expected prices at the counter in the legal market. In reaction to the revised budget, Ontario politicians are engaging more deeply with Premier Doug Ford’s government and introducing changes to how cannabis is sold across the province to increase sales in the legal market.

 

The U.S. is closely monitoring the evolution of these markets in Canada and the Canadian case study could play a formative role in how some states move forward.

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

12 April 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — April 5, 2019

CANADA CANNABIS SPOT INDEX (CCSI) 

Published April 5, 2019

The CCSI remained essentially flat this week at C$6.94 per gram, when compared to last week’s C$6.96 per gram. The price range has been relatively steady over the past six weeks, with only a $C0.18 difference between the low and high extremes observed in that span. This week’s price of C$6.94 per gram equates to US$2,359 per pound at current exchange rates.

 

According to Statistics Canada, 15.4% of the Canadian population above the age of 15 reported using cannabis, which works out to approximately 4.63 million people across Canada. Also from the Government of Canada, we are able to access nationwide retail sales figures. From the latest published data, we can see that C$53.38M in revenue was generated in the month of January. January’s sales are down by C$2.5M, or 4.5%, from those of December 2018.

 

When we merged the January sales data with the reported number of users, we are able to estimate the average spend per person. These calculations tell a very interesting story about the usage in each province, and have implications for the development of the legal market across the country.

British Columbia, known colloquially to be the cannabis capital of Canada, has a uniquely low spend per person. This implies that the lack of product inventory or higher prices at legal retail outlets have resulted in much of the population turning to the illicit market for their supply.

 

Ontario, the largest province with almost 38% of the Canadian population, has sales figures lower than Quebec and Alberta. The reason cannabis users have been spending less on legal cannabis could be due to the exclusively online sales format that prevailed until April 1st of this year. With the recent opening of 10 brick-and-mortar locations in Ontario and 15 more by the end of this month, we expect sales figures and spend per person to increase significantly.


Manitoba, Newfoundland & Labrador, Alberta, and New Brunswick each has a calculated spend of approximately C$25/person during January. Based on our price index, this equates to approximately 2.5 grams of usage per month.

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

5 April 2019 Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved