October 28, 2022

U.S. Cannabis Spot Index — October 28, 2022

U.S. Cannabis Spot Index — Published October 28, 2022

The U.S. Cannabis Spot Index decreased 4.5% to $954 per pound.

 

The simple average (non-volume weighted) price decreased $47 to $1,301 per pound, with 68% of transactions (one standard deviation) in the $527 to $2,075 per pound range. The average reported deal size was nominally unchanged at 2.4 pounds. In grams, the Spot price was $2.10 and the simple average price was $2.87.

 

The relative transaction frequency of indoor product fell 1%, while that of deals for greenhouse and outdoor flower each rose 1%.

 

 

The relative volume of indoor product fell 2%, while that of greenhouse product rose 3%. Outdoor flower’s relative volume was unchanged this week.

 

 

The Cannabis Benchmarks U.S. Spot Index fell $45 this week as legacy states lost net $96 on the week. Both Colorado’s and California’s spot prices for wholesale flower fell to new all-time lows this week with the outdoor harvest yet to come to market in full force.

New England states were net gainers on the week with Massachusetts spot jumping $71. Prices in the state may come under pressure when the outdoor crop comes to market over the next few weeks, though the size of the harvest is unknown and therefore price effects are a tough call. Maine spot fell $36 this week. The spread between Maine and Massachusetts collapsed from $133 last week to just $2 this week, illustrating the tendency for prices of similar or like commodity prices to converge.

Vermont price gained just $3 per pound wholesale, but is still trading at a $100 premium to its two New England counterparts with open adult use markets. Vermont still has very limited distribution and may see prices firm as new adult use retailers stock inventory ahead of opening for business. That said, any premium between contiguous states where all other factors are similar or equal should see an almost immediate price convergence.

November 2022 Implied Forward unchanged to close at $950 per pound.

 

The average reported forward deal size was 76 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 50%, 36%, and 14% of forward arrangements, respectively.

 

The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 82 pounds, 72 pounds, and 67 pounds, respectively.

 

 

At $950 per pound, the November 2022 Implied Forward represents a discount of 0.4% relative to the current U.S. Spot Price of $954 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:

Arizona

Cannabis Price Pressures – Interview

Massachusetts

September Adult Use Sales Sink MoM Amid Strong Demand

Oklahoma

Awash in Licenses, Sales Suffer

New York

Indefinite Adult Use License Delays

Are you a licensed market participant in the U.S. or Canada? 

Do you support wholesale market transparency?

Become a member of our Price Contributor Network and receive discounted pricing and exclusive analysis!

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

28 October 2022.  Copyright © 2022 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — October 28, 2022

CANADA CANNABIS SPOT INDEX (CCSI) 

Week Ending October 28, 2022
CCSI image 1 2022-10-28

*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$5.22 per gram this week, down 0.6% from last week’s C$5.25 per gram. This week’s price equates to US$1,742 per pound at the current exchange rate.

Include your weekly wholesale transactions in our price assessment by joining our Price Contributor Network

If you have not already done so, we invite you to join our Price Contributor Network, where market participants anonymously submit wholesale transactions to be included in our weekly price assessments. It takes two minutes to join and two minutes to submit each week, and comes with loads of extra data and market intelligence.

SOURE: Cannabis Benchmarks, Health Canada
  • Statistics Canada recently released August retail cannabis sales for the country. August sales, at C$393.7M, were only C$0.8M higher than July. To correct for the different number of days per month, we look at the data in terms of average daily sales in the above chart. The latest data shows average daily sales hit a peak of C$12.7M in August, an increase of 13% from the same month last year. As seen in the chart above, the annual growth has slowed considerably, leading to a plateau in sales.
  • However, it is important to note that there were a number of anomalous factors that prevented sales from being considerably higher in August. First, Ontario’s provincial cannabis wholesaler, the Ontario Cannabis Store (OCS), suspended deliveries to retailers after a cyberattack impacted one of its supply chain partners. The delivery halt began August 5 and lasted almost a week. The OCS’s actions were precautionary, as the cyberattack did not impact their operation directly, but rather that of its key distribution partner, Domain Logistics.
  • Second, labor issues in British Columbia (BC) prevented the provincial cannabis distribution center from distributing goods to private retail locations for a significant portion of late August. Privately held businesses in the province, which are obligated to obtain their supply from the BC Liquor Distribution Branch (BCLDB), stated that they were forced to temporarily close because they were out of stock.
  • Third, there is still fierce rivalry in Alberta’s retail sector, which is starting to result in comparatively low sales margins and storefront closures.
  • If sales continue at the daily run rate for August for the rest of the year, total 2022 sales should exceed C$4.49B. (That calculation assumes daily sales average C$12.7M between September and December.) This should establish the low-end expectation for sales this year, given that both Ontario and British Columbia have resolved their internal issues. Additionally, we continue to see growth in store counts and more online / delivery options, which should continue to move cannabis consumers away from the illicit markets.

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

28 October 2022 Copyright © 2022 New Leaf Data Services, LLC.  All rights reserved

October 21, 2022

U.S. Cannabis Spot Index — October 21, 2022

U.S. Cannabis Spot Index — Published October 21, 2022

The U.S. Cannabis Spot Index increased 1.4% to $999 per pound.

 

The simple average (non-volume weighted) price increased $141 to $1,348 per pound, with 68% of transactions (one standard deviation) in the $549 to $2,147 per pound range. The average reported deal size decreased to 2.4 pounds. In grams, the Spot price was $2.20 and the simple average price was $2.97. [Note: We have initiated coverage of Pennsylvania. This week’s increase in the U.S. simple average price and standard deviation reflects this addition.]

 

The relative transaction frequency of indoor product rose 4%, while that of greenhouse flower fell 4%. Outdoor flower transaction frequency was unchanged. The relative volume of indoor product fell 1%, as did that of greenhouse product. Outdoor flower’s relative volume rose 1% this week.

 

The Cannabis Benchmarks U.S. Spot Index jumped $14 this week despite a net loss across legacy states of $30 per wholesale pound. Croptober has taken legacy state outdoor flower on a downward trajectory, with Oregon and Colorado volume-weighted spot prices seemingly in a race to the bottom. The outdoor flower spread price is just $12 between these two states; the spread was $133 as recently as July 2022. California and Washington State outdoor prices are likewise entwined with chart formation suggesting lower prices are likely in the immediate future.

California and Oregon indoor product prices are moving higher on demand for what many connoisseurs will say is the best cannabis in the world. While there is some evidence of capitulation in the Oregon cultivator market as license renewals dip amid the state’s second moratorium, it would be too much to say the moratorium is responsible for higher prices of late.

The spread between California and Oregon indoor product has closed to $178 per pound from $424 since mid-September 2022 on what is more likely out-of-state rather than new in-state demand in these mature markets. Indeed, the likelihood that demand for higher-end product will increase as more states legalize cannabis is a foregone conclusion. Both states have memorialized interstate trade into law ahead of nationwide legalization because they see it as an inevitable eventuality, albeit on vague timelines.

November 2022 Implied Forward unchanged at $950 per pound.

 

The average reported forward deal size was 76 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 51%, 35%, and 14% of forward arrangements, respectively.

 

The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 82 pounds, 70 pounds, and 65 pounds, respectively.

 

 

At $950 per pound, the November 2022 Implied Forward represents a discount of 4.9% relative to the current U.S. Spot Price of $985 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

Cannabis Optimist Found!- Interview

Arizona

Recent Monthly Sales a Sea of Red

Michigan

September Sees New Sales Record as Prices Crash

New Mexico

Adult Use Sales Inch Higher Amid Medical Sales Exodus

Are you a licensed market participant in the U.S. or Canada? 

Do you support wholesale market transparency?

Become a member of our Price Contributor Network and receive discounted pricing and exclusive analysis!

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

21 October 2022.  Copyright © 2022 New Leaf Data Services, LLC.  All rights reserved

CANADA CANNABIS SPOT INDEX — October 21, 2022

CANADA CANNABIS SPOT INDEX (CCSI) 

Week Ending October 21, 2022
CCSI image 1 2022-10-21

*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$5.25 per gram this week, down 0.4% from last week’s C$5.27 per gram. This week’s price equates to US$1,732 per pound at the current exchange rate.

Include your weekly wholesale transactions in our price assessment by joining our Price Contributor Network

If you have not already done so, we invite you to join our Price Contributor Network, where market participants anonymously submit wholesale transactions to be included in our weekly price assessments. It takes two minutes to join and two minutes to submit each week, and comes with loads of extra data and market intelligence.

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

21 October 2022 Copyright © 2022 New Leaf Data Services, LLC.  All rights reserved

October 14, 2022

CANADA CANNABIS SPOT INDEX — October 14, 2022

CANADA CANNABIS SPOT INDEX (CCSI) 

Week Ending October 14, 2022
CCSI image 1 2022-10-14

*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$5.27 per gram this week, down 1.3% from last week’s C$5.34 per gram. This week’s price equates to US$1,732 per pound at the current exchange rate.

Include your weekly wholesale transactions in our price assessment by joining our Price Contributor Network

If you have not already done so, we invite you to join our Price Contributor Network, where market participants anonymously submit wholesale transactions to be included in our weekly price assessments. It takes two minutes to join and two minutes to submit each week, and comes with loads of extra data and market intelligence.

SOURE: Cannabis Benchmarks, Health Canada
  • This week Cannabis Benchmarks analyzed Statistics Canada’s data on dry cannabis and cannabis oil exports. As more countries legalize medical cannabis, Canada’s expertise in cultivation methods and quality has made it an export leader. Canada is the largest exporter of cannabis flower and oil in the world, but under the Cannabis Act it is only allowed to export cannabis for medical purposes.
  • Statistics Canada reports both the permitted quantities and the actual quantities that were shipped by licensed producers. The current dataset provides monthly export quantities through December 2021. As seen in the chart above, the growth in exports has been steady, with the majority of the cannabis exports being in the form of dry flower. The peak export month was November 2021 with 4,853 kg equivalent of cannabis exported.
  • In 2021, total cannabis exports reached 31,852 kg, an increase of 86% over the previous year. On a cumulative basis since cannabis was legalized for adult use, a total of 61,334 kg equivalent has been shipped to other countries. Of this product, 87% was shipped as dry flower to countries that have growing medical cannabis markets such as Germany, Israel, Belgium, Croatia, Chile, Brazil, New Zealand, and Australia.
  • In the future, we do not anticipate a significant amount of growth for Canadian cannabis exports. Latin America, Australia, and more progressive European nations are competing with major cannabis exporters like Canada and the Netherlands. Additionally, nations like Germany and Israel who have historically imported medical cannabis are now expanding their local manufacturing capabilities.

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

14 October 2022 Copyright © 2022 New Leaf Data Services, LLC.  All rights reserved