U.S. Cannabis Spot Index — Published October 11, 2019
U.S. Cannabis Spot Index down 0.5% to $1,416 per pound.
The simple average (non-volume weighted) price increased $34 to $1,625 per pound, with 68% of transactions (one standard deviation) in the $923 to $2,326 per pound range. The average reported deal size increased to 1.9 pounds. In grams, the Spot price was $3.12 and the simple average price was $3.58.
The relative frequency of trades for indoor flower decreased by almost 2% this week. The relative frequencies of deals for greenhouse and outdoor product increased by a bit over 1% and less than 1%, respectively. Outdoor flower’s share of the total documented weight moved nationally expanded by over 7% this week. The relative volumes of warehouse and greenhouse product contracted by about 5% and 3%, respectively.
The U.S. Spot Index declined by 0.5% this week to settle at $1,416 per pound. Declines in the composite prices of Washington State and Nevada – along with several mid-sized markets – overwhelmed an uptick in Oregon, while the Spot Indices of California and Colorado were essentially stable this week.
Following the institution of a ban on all vape products by Massachusetts officials, the governors of both Oregon and Washington State followed suit with partial bans, which could result in unexpected impacts on wholesale flower prices just as this year’s fall harvest begins to make its way to market. Retail purchasing data reported by other sources at this point shows diverse consumer reactions in certain states in the period immediately after the vape crisis surfaced, but definitive conclusions on how the issue will impact market dynamics long-term remain uncertain as investigations and reactions are still developing.
As alluded to, bans on certain vape products in West Coast states could affect the markets for outdoor-grown flower, much of which is sold to processors for extraction and infused product manufacturing. If a significant amount of vape cartridge manufacturers are compelled to cease production due to the new prohibitions on selected products, it is possible that outdoor farmers could lose buyers that they had previously lined up for their autumn crops.
The national volume-weighted price for flower to be sold to general consumers ticked upward this week on rises in that sector of the market in Colorado, as well as in Oregon and Alaska’s adult-use markets. The national price for medical flower declined on decreases in that portion of California’s and Massachusetts’ markets, in addition to the downturns in the medical-only markets of Connecticut, Illinois, Maine, Michigan, New Mexico, Rhode Island, and Vermont.
November Forward unchanged at $1,250 per pound. The average reported forward deal size increased to 57 pounds. The proportion of forward deals for outdoor, greenhouse, and indoor-grown flower was 57%, 28%, and 15% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 60 pounds, 41 pounds, and 70 pounds, respectively.
At $1,250 per pound, the November Forward represents a discount of 11.7% relative to the current U.S. Spot Price of $1,416 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:
- Fall Outdoor Harvest Begins to Come to Market Amidst Planned Power Outages in Northern California, Concerns About Vape Products
Price of Outdoor Flower Jumps in Recent Weeks as Upward Momentum in Rates for Other Grow Types Level Off
Oregon & Washington
- Bans on Flavored Vape Products Could Reduce Demand for Outdoor Flower Used for Extraction and Processing
- Retail Sales Slip Month-Over-Month for First Time Since Early this Year; YTD Revenues Still Up by 92% Compared to the Same Period in 2018
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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC
11 October 2019. Copyright © 2019 New Leaf Data Services, LLC. All rights reserved