Canada Cannabis Spot Index (CCSI) 

Published June 5, 2020


*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$6.39 per gram this week, down 0.3% from last week’s C$6.41 per gram. This week’s price equates to US$2,135 per pound at the current exchange rate.

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This week we outline the scope of the growing Canadian industrial hemp market. 

Under the Cannabis Act, which made cannabis legal last October, Health Canada also set out the Industrial Hemp Regulations (IHR). The rules define hemp as a cannabis plant with a concentration of less than 0.3% THC in the flowering heads and leaves. The IHR constructed a framework around certain activities involving hemp, such as its cultivation, sale, and processing, as well as its importation and exportation into and from Canada. A license needs to be obtained from Health Canada in order to conduct any of these activities.

Starting in the 1980’s, industrial hemp cultivation was permitted for scientific research purposes. The first license to grow industrial hemp for commercial purposes in Canada was issued in May 1998. Health Canada data compiled in 2018 shows there were 1,226 licenses issued, with 711 of those for cultivation. Unsurprisingly, 63% of the total cultivation licenses in the country were issued to growers in the three prairie provinces: Alberta, Saskatchewan, and Manitoba.

Source: Hemp Benchmarks, Health Canada

A breakdown of the acreage licensed for cultivation of hemp by province shows a similar picture in which the three prairie provinces constitute most of the country’s production capacity.

Source: Hemp Benchmarks, Health Canada

According to Health Canada, a total of 31,537 hectares, or 77,929 acres, were approved to grow industrial hemp in 2018. Alberta led all provinces with 13 licencees holding cultivation permits encompassing approximately 30,000 acres. We anticipate that Health Canada will update the dataset to include 2019 figures as lockdowns ease, and government workers return to work. 

Under the new hemp regulations, harvested hemp flowers, leaves, and branches can be sold to licensed cannabis processors, although the majority of hemp grown in Canada to date is for hempseed. Hempseed is typically used in a wide range of food products, such as hemp oils, hemp protein powders, hemp flour and hemp meal. 

Lastly, we note that hemp varieties are strictly controlled by the federal government and growers may only plant a limited variety. Below is the complete list of the approved seed varieties for the 2019 growing season, along with the country of origin. 

Source: Hemp Benchmarks, Health Canada

For more data and analytics like this, subscribe to the Cannabis Market Insights report developed in collaboration Nasdaq. This in-depth monthly report provides exclusive data and analysis on the legal cannabis industry, focusing largely on the Canadian cannabis market, as well as the cannabis equities market in the U.S.