U.S. Cannabis Spot Index — August 16, 2019

U.S. Cannabis Spot Index — Published August 16, 2019

U.S. Cannabis Spot Index down 0.7% to $1,328 per pound.

 

The simple average (non-volume weighted) price decreased $1 to $1,493 per pound, with 68% of transactions (one standard deviation) in the $777 to $2,208 per pound range. The average reported deal size increased to 2.3 pounds from 2.0 pounds last week. In grams, the Spot price was $2.93 and the simple average price was $3.29.

 

The relative frequency of trades for indoor flower increased by 1% week-over-week. The relative frequency of transactions involving outdoor product decreased by the same proportion, while that for deals for greenhouse flower was unchanged. Greenhouse flower’s share of the total documented weight moved nationally contracted by 3% this week. The relative volume of outdoor product expanded by the same magnitude, while that for warehouse flower was stable.  

The U.S. Spot Index declined by 0.7% this week to settle at $1,328 per pound. The small decline in the national composite price was due to an increase in the relative volume of lower-priced outdoor flower, as well as slight downturns in the national volume-weighted rates of the other two grow types. 

 

The overall expansion of the relative volume of outdoor flower nationally was driven primarily by observations out of California’s market. A significant uptick in the average deal size for such product in the Golden State, along with a small increase in its volume-weighted price, indicates that summer light-deprivation crops are coming to market. 

 

Meanwhile, prices in the other major Western markets continued to trend upward this week. As we detail below, record-setting demand has persisted in Colorado and Oregon. However, signs of increasing seasonal production in the latter state could be setting the stage for a reversal of the positive momentum that has characterized prices in the Beaver State since April. 

The national volume-weighted price for flower to be sold to general consumers increased this week as rises in that sector of the market in Colorado, as well as in Oregon and Washington State, outweighed declines in California and Nevada. 

 

Prices for medical flower sank this week. Rates for product designated for registered patients saw downturns in Michigan, Illinois, Massachusetts, Maine, and Rhode Island, as well as some smaller markets.

 

September Forward unchanged at $1,240 per pound.

 

The average reported forward deal size was nominally unchanged at 48 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower remained at 55%, 29%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 41 pounds, 50 pounds, and 64 pounds, respectively.

 

At $1,240 per pound, the September Forward represents a discount of 6.6% relative to the current U.S. Spot Price of $1,328 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

  • Prices for Flower in State’s Adult-Use Sector Have Seen Significant Volatility So Far This Summer
  •  
  • Colorado

    Total Monthly Cannabis Sales Reach New Record in June, Topping $150 Million for the First Time as State Spot Index Climbs

  • Oregon

  • Overall Retail Demand and Sales Volume of Flower Ascend to Unprecedented Heights in July; Harvest Volume Also Expanded Significantly, Signalling Seasonal Uptick in Supply
  •  
  • Washington

  • State Regulators Consider Big Changes to Traceability & Product Testing, but Actual Implementation Still a Long Way Off
  •  
  • Massachusetts

  • Adult-Use Sales Reached Over $45 Million in July, but Growth Slowing as Pace of Licensing Continues to be Sluggish
  •  
  • Illinois

  • Demand Still Booming Through July as Both Dispensary and Cultivator Sales Again Set New Records; Monthly Retail Revenue Double That of July 2018

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

16 August 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — August 9, 2019

U.S. Cannabis Spot Index — Published August 9, 2019

U.S. Cannabis Spot Index up 1.3% to $1,337 per pound.

 

The simple average (non-volume weighted) price increased $18 to $1,494 per pound, with 68% of transactions (one standard deviation) in the $781 to $2,207 per pound range. The average reported deal size was nominally unchanged at 2.0 pounds. In grams, the Spot price was $2.95 and the simple average price was $3.29.

 

The relative frequency of trades for greenhouse flower decreased by 2% week-over-week. The relative frequency of transactions involving outdoor product increased by the same proportion, while that for deals for indoor flower was unchanged. Greenhouse flower’s share of the total documented weight moved nationally contracted by 5% this week. The relative volumes of warehouse and outdoor product expanded by 2% and 3%, respectively.

The U.S. Spot Index rose by 1.3% this week to settle at $1,337 per pound. The generally upward trend observed in wholesale cannabis prices this summer resumed after last week’s momentary downturn. Still, there are signs that downward pressure on rates could be arriving in major markets in the weeks to come. Relative volumes of outdoor flower in both California and Oregon saw significant expansions this week. Volume-weighted prices for such product continued to trend downward in California and have recently flattened in Oregon, after rates for outdoor flower in the Beaver State have been on the upswing since around the close of the first quarter.  

The national volume-weighted price for flower to be sold to general consumers increased this week on rises in that sector of the market in California and Colorado, as well as in Oregon, Washington State, and Alaska. Prices for medical flower were also on the upswing this week. Rates for product designated for registered patients saw upticks in California, Arizona, Illinois, New Mexico, Maine, Rhode Island, and Washington, D.C.  

 

September Forward unchanged at $1,240 per pound.

 

The average reported forward deal size was unchanged at 48 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower remained at 55%, 29%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 42 pounds, 51 pounds, and 62 pounds, respectively.

 

At $1,240 per pound, the September Forward represents a discount of 7.2% relative to the current U.S. Spot Price of $1,337 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 YTD Peak, Settling at Highest Price Seen Since 4/20 2018
  •  
  • Colorado

    MED’s 2018 Annual Report Shows Amount of Flower Generated by Growers Expanded by 10% from 2017, But Growth in Production Capacity Leveled Off by End of 2018

  • Oregon

  • Increases in Relative Volume of Outdoor Flower and Flattening Prices for Such Product Have Tempered Upward Trend in State’s Spot Index
  •  
  • Washington

  • State Climatologist’s Report Indicates Favorable Growing Conditions for Hoop House and Outdoor Growers So Far this Season
  •  
  • Michigan

  • Most Medical Cannabis Businesses Will See Reductions in Licensing Fees for Upcoming FY

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

9 August 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved

U.S. Cannabis Spot Index — August 2, 2019

U.S. Cannabis Spot Index — Published August 2, 2019

U.S. Cannabis Spot Index down 2.9% to $1,320 per pound.

 

The simple average (non-volume weighted) price decreased $79 to $1,476 per pound, with 68% of transactions (one standard deviation) in the $754 to $2,198 per pound range. The average reported deal size declined to 2.0 pounds from 2.2 pounds last week. In grams, the Spot price was $2.91 and the simple average price was $3.25.

 

The relative frequency of trades for indoor flower decreased by 3% week-over-week. The relative frequency of transactions involving outdoor product increased by the same proportion, while that for greenhouse flower was unchanged. Greenhouse flower’s share of the total documented weight moved nationally expanded by 1% this week. The relative volume of warehouse product shrank by the same proportion, while that for outdoor flower was stable.

The U.S. Spot Index declined by 2.9% this week to settle at $1,320 per pound. Downturns in three of the five major markets pulled down the national average, as Washington State and Nevada were the only states of that group to see rises in their Spot prices, and modest ones at that. Additionally, rates slid downward in the secondary markets of Illinois and Michigan, which had earlier this year been applying upward pressure on the U.S. Spot. Reports from Oregon indicate that the bulk of the summer light-deprivation crop has not yet come in, with new, fresh supply expected to hit the market later this month or in early September.  

The national volume-weighted price for flower to be sold to general consumers decreased this week on downturns in that sector of the market in California and Colorado, as well as in Oregon. 

 

Prices for medical flower rose this week. Rates for product designated for registered patients saw upticks in Washington State, Nevada, and Massachusetts, while the medical-only markets of Maine, Connecticut, D.C., and Vermont experienced increases in their Spot prices.

 

February 2020 Forward initially assessed at $1,200 per pound.

 

The average reported forward deal size was unchanged at 48 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 55%, 29%, and 16% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 42 pounds, 52 pounds, and 64 pounds, respectively.

 

Several factors could combine to exert upward pressure on the U.S. Spot at the end of this year and in early 2020. As we discuss below, Illinois’ adult-use legalization law appears as if it has laid the groundwork for tight supply in the second-largest state by population to permit a recreational cannabis industry. Additionally, Michigan could begin adult-use sales late this year or in early 2020, although the scope of the market may be relatively small at the outset. 

 

Finally, Los Angeles continues to make progress toward issuing what is expected to be around 240 additional retail licenses. Applications for such permits are scheduled to be accepted beginning in September. Once the licenses are issued, it will represent the largest retail expansion in California’s legal market since the initial opening of the adult-use system at the beginning of 2018, creating a major source of new wholesale demand and shelf space to be filled. 

 

 

At $1,240 per pound, the September Forward represents a discount of 6.1% relative to the current U.S. Spot Price of $1,320 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 Spot Price Stable from June to July; July 2019’s Mean Price Up 8% Year-Over-Year
  •  
  • Colorado

    July 2019’s Spot Rate Up 20% Compared to Same Month Last Year

  • Oregon

  • Rainy Summer May Have Delayed Light-Deprivation Harvests, New Sun-Grown Supply Might Not Arrive Until Later in August

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

2 August 2019.  Copyright © 2019 New Leaf Data Services, LLC.  All rights reserved