The CCSI declined another 3.4% this week to C$6.38 per gram, from C$6.60 per gram last week. The index has been steadily dropping over the past 5 weeks. C$6.38 per gram equates to US$2,178 per pound at current exchange rates.

StatsCan analysis found that recreational dried cannabis sold from a licensed supplier sold for C$9.70 per gram on average since legalization. This is drastically higher than the calculated C$6.51 per gram paid by consumers in the still thriving illicit markets. The entire industry is closely watching these prices as legalization was expected to set back the illegal supply while also controlling quality and bringing in tax revenue. Cannabis Benchmarks expects the price of cannabis to continue to drop as the current licensed producers increase business operation efficiencies and add capacity over the next 18 months. This follows a similar trend to that observed in the early years of most recreational U.S. markets.

One of the major Canadian licensed producer, Aurora Cannabis, gave industry watchers some additional insight into how the legalization process has been going so far. On January 8th, Aurora announced guidance for its Q2 2019 results, or quarter ending December 31. These early estimates show revenue of C$50 to C$55 million, net of the excise tax. The guidance indicates C$17 million in recreational sales from the start of legalization (C$20.6 million extrapolated back to the beginning of the quarter), which is lower than analyst estimates. Aurora earnings are scheduled to be released on February 11, 2019.

Lastly, up to 8,000 entrants are expected to enter a lottery today for licenses for the first 25 cannabis stores to open in Ontario starting April 1. The licences are being divided regionally, with five going to the east of the province, seven in the west, two in the north, six in the Greater Toronto Area and five in Toronto itself. Recreational cannabis can only be bought through the Ontario government-run website at the moment.