January 21, 2021

U.S. Cannabis Spot Index — January 22, 2021

U.S. Cannabis Spot Index — Published January 22, 2021

U.S. Cannabis Spot Index up 0.6% to $1,486 per pound.

 

The simple average (non-volume weighted) price decreased $29 to $1,749 per pound, with 68% of transactions (one standard deviation) in the $1,013 to $2,484 per pound range. The average reported deal size decreased to 2.4 pounds. In grams, the Spot price was $3.28 and the simple average price was $3.86.

 

The relative frequency of trades for greenhouse flower decreased by 1%. The relative frequency of deals for outdoor product increased by the same proportion, while that for indoor flower was unchanged.

  

 

The relative volume of warehouse flower expanded by 4% this week. The relative volumes of greenhouse and outdoor product contracted by 1% and 3%, respectively.

The city of Detroit began accepting applications for adult-use retailers this week, on Tuesday, January 19. Applications will initially only be accepted from “legacy residents” who meet certain criteria under a social equity program, according to the Detroit News. To this point, Detroit has not permitted any adult-use cannabis businesses to open in the city. We noted previously that licenses could be issued as soon as June 2021. 

 

The Detroit News report notes, “only a handful of the city’s 46 medical marijuana dispensaries … are owned by [Detroit] residents.” This suggests that, for the most part, sales to adult-use consumers will not begin through existing stores as soon as licenses are issued and most new licensees will have to get up and running from scratch.

February Implied Forward declined $25 to $1,500 per pound.

 

The average reported forward deal size was 39.6 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 52%, 35%, and 13% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 55 pounds, 21 pounds, and 26 pounds, respectively.

 

At $1,500 per pound, the February Implied Forward represents a premium of 1.0% relative to the current U.S. Spot Price of $1,486 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:

Michigan

Combined Adult-Use and Medical Cannabis Sales Reach Almost $985 Million in 2020

Arizona

New Adult-Use Market May Open in Coming Days, About Two Months Ahead of Expectations

New Mexico

Medical Cannabis Sales Expanded Significantly in Q3 2020, Even as Growth in Patient Count Slowed

Massachusetts

Adult-Use Delivery Businesses Expected to Come Online this Year, but May Be Delayed by Litigation

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

22 January 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

January 15, 2021

U.S. Cannabis Spot Index — January 15, 2021

U.S. Cannabis Spot Index — Published January 15, 2021

U.S. Cannabis Spot Index down 0.9% to $1,477 per pound.

 

The simple average (non-volume weighted) price was unchanged at $1,777 per pound, with 68% of transactions (one standard deviation) in the $1,032 to $2,523 per pound range. The average reported deal size decreased to 2.5 pounds. In grams, the Spot price was $3.26 and the simple average price was $3.92.

 

The relative frequency of trades for indoor flower decreased by 1%. The relative frequency of deals for outdoor product increased by the same proportion, while that for greenhouse flower was unchanged.  

 

The relative volume of outdoor flower contracted by 1% this week.

 

The relative volume of greenhouse product expanded by the same proportion, while that for warehouse flower was unchanged.

The early weeks of 2021 have seen the U.S. Spot Index’s downward trend, which commenced in November with the fall harvest, continue. The current price erosion is being driven almost exclusively by falling rates in California, Colorado, and Oregon. Additionally, states in which prices had previously been climbing – namely Massachusetts, Michigan, and Illinois – have seen that upward momentum level off in recent weeks.

 

We have pointed out previously that the winter months typically see lower demand relative to the spring and summer, with the exception of a sales boost in December in many cases. One of the most notable findings in this week’s Premium Report is that total sales in Colorado in November dropped sharply, by over 12% compared to the prior month. A downturn in retail revenue from October to November is customary; however, this year’s decrease was more than twice the magnitude of that observed last year, indicating a significant pullback in purchasing that month.

 

 

On the other hand, Arizona’s Spot Index is trending upward as the beginning of adult-use sales draws closer. The state’s medical market saw almost 190,000 pounds of flower retailed to patients in 2020 – the fifth-largest flower sales volume in the country last year by our estimates – up by about 25% from the year prior. Notably, however, wholesale prices in the state trended downward for much of the year even in the face of strong demand, and only began to rise in the closing months of 2020 with the imposition of required product testing and the approval of adult-use legalization by voters, which both occurred in November.

February Implied Forward unchanged at $1,525 per pound.

 

The average reported forward deal size increased from 38.9 pounds to 40.1 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 52%, 34%, and 14% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 56 pounds, 21 pounds, and 26 pounds, respectively.

 

At $1,525 per pound, the February Implied Forward represents a premium of 3.3% relative to the current U.S. Spot Price of $1,477 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:

Colorado

YTD 2020 Sales Exceed $2 Billion as of November, Even as Monthly Tallies Have Declined Since August

Arizona

Medical Dispensaries Sold Almost 190,000 Pounds of Flower to Patients in 2020, the Fifth-Largest Sales Volume Total of Any State Market

Maine

December Adult-Use Sales Top $1.9 Million, Up 50% from November

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

15 January 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

January 8, 2021

U.S. Cannabis Spot Index — January 8, 2021

U.S. Cannabis Spot Index — Published January 8, 2021

U.S. Cannabis Spot Index down 2.6% to $1,491 per pound.

 

The simple average (non-volume weighted) price decreased $22 to $1,777 per pound, with 68% of transactions (one standard deviation) in the $1,041 to $2,514 per pound range. The average reported deal size increased to 2.6 pounds. In grams, the Spot price was $3.29 and the simple average price was $3.92.

 

The relative frequencies of trades for each grow type were essentially stable from last week.

 

 

The relative volume of indoor flower contracted by 1% this week. The relative volume of outdoor product expanded by the same proportion, while that for greenhouse flower was unchanged.

Several states have reported full-year sales figures for 2020, which we examine in detail below. Overall, states with existing, more mature adult-use markets saw demand growth accelerate last year.  Newer markets such as Illinois and Michigan posted impressive total retail revenue figures, which slightly exceeded and approached $1 billion in each state, respectively. 

 

In the face of elevated sales, the U.S. Spot Index closed 2020 by declining by 9.5% from its annual peak on October 23 to the final week of the year. Despite apprehensions concerning the state of the fall harvest due to wildfires on the West Coast, wholesale prices are trending downward in all three of those states, as well as Colorado, mainly on the introduction of larger amounts of lower-priced outdoor flower into commerce. Anecdotal reports out of Oregon and California have so far told of crops escaping major damage or contamination from the fires. Prior to the wildfires reaching their peak in September and October, reports from market participants stated that growing conditions were excellent. 

 

 

Western markets are still largely steering the direction of the U.S. Spot, as the volumes of flower being traded remain much higher than those in newer markets. For example, although Illinois’ retail revenue figures were comparable to those of Oregon’s in 2020, Cannabis Benchmarks estimates that Oregon retailers sold roughly 250,000 pounds of flowers to consumers and patients last year, while we estimate total flower sales volume in Illinois – both adult-use and medical – reached about 75,000 – 80,000 pounds.

February Implied Forward unchanged at $1,525 per pound.

 

The average reported forward deal size increased from 36.5 pounds to 38.9 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 52%, 35%, and 13% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 55 pounds, 21 pounds, and 26 pounds, respectively.

 

At $1,525 per pound, the February Implied Forward represents a premium of 2.3% relative to the current U.S. Spot Price of $1,491 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:

Washington

FY 2020 Sales Up 20% from Prior FY

Michigan

Combined Adult-Use and Medical Cannabis Sales Near $900 Million in First 11 Months of 2020

Massachusetts

Adult-Use Retailers Generated Almost $700M in Revenue in 2020, Despite Being Ordered Closed for 2 Months Due to Coronavirus

Illinois

Total Legal Sales in 2020 Top $1 Billion in First Year of Adult-Use Legalization

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

8 January 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

December 30, 2020

U.S. Cannabis Spot Index — January 1, 2021

U.S. Cannabis Spot Index — Week Ending January 1, 2021

U.S. Cannabis Spot Index up 1.6% to $1,531 per pound.

 

The simple average (non-volume weighted) price decreased $8 to $1,800 per pound, with 68% of transactions (one standard deviation) in the $1,064 to $2,536 per pound range. The average reported deal size decreased to 2.4 pounds. In grams, the Spot price was $3.38 and the simple average price was $3.97.

June 2021 Implied Forward initially assessed at $1,625 per pound.

 

The average reported forward deal size was unchanged at 38.6 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 50%, 35%, and 15% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 55 pounds, 21 pounds, and 26 pounds, respectively.

 

At $1,525 per pound, the February 2021 Implied Forward represents a discount of 0.4% relative to the current U.S. Spot Price of $1,531 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.

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

1 January 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

December 23, 2020

U.S. Cannabis Spot Index — December 25, 2020

U.S. Cannabis Spot Index — Published December 25, 2020

U.S. Cannabis Spot Index down 1.5% to $1,506 per pound.

 

The simple average (non-volume weighted) price decreased $8 to $1,808 per pound, with 68% of transactions (one standard deviation) in the $1,076 to $2,540 per pound range. The average reported deal size increased to 2.5 pounds. In grams, the Spot price was $3.32 and the simple average price was $3.99.

 

The relative frequencies of trades for each grow type were essentially stable from last week. 

 

 

The relative volume of indoor flower contracted by 2% this week. The relative volume of outdoor product expanded by the same proportion, while that for greenhouse flower was unchanged.

The U.S. Spot Index closed 2020 at $1,506 per pound, up 7.8% from the rate of $1,397 per pound observed at the outset of the year. However, the final two months of this year saw the national composite price decline after climbing steadily from late May through late October. The U.S. Spot averaged $1,524 per pound in December, off by 6% from November’s monthly mean of $1,621 per pound. National wholesale flower prices were pulled down by falling rates in some of the largest markets, such as California, Colorado, and Oregon, while upward trends in states like Nevada and Michigan subsided in the final month of the year. 

 

For 2020 overall, the U.S. Spot averaged $1,471 per pound, up 15.6%, or almost $200, from 2019’s annual mean composite price of $1,273 per pound. 2020 is the second consecutive year in which the U.S. Spot’s annual average exceeded that from the year before, after national wholesale prices declined from 2016 through 2018. 

 

 

Growth in existing markets – including California, Colorado, Oregon, and others – fueled in large part by expanded demand observed during the COVID-19 pandemic this year, pushed up wholesale prices in 2020. The establishment and growth of new and younger adult-use systems in Massachusetts, Michigan, and Illinois also injected more high-priced transactions for wholesale flower into our data than have been observed in prior years.

January 2021 Implied Forward down $40 to $1,500 per pound.

 

The average reported forward deal size was unchanged at 36.5 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 46%, 36%, and 18% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 54 pounds, 21 pounds, and 23 pounds, respectively.

 

At $1,500 per pound, the January Implied Forward represents a discount of 0.4% relative to the current U.S. Spot Price of $1,506 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

Exclusive State Data Shows Volume of Flower, Trim, Fresh Plants Traded Wholesale in California from 2018 through Q3 2020

Colorado

State Spot Index Closes the Year Down Almost $200 from Late October Peak

Nevada

Wholesale Flower Prices Leveled Off in Final Two Months of the Year After Previously Climbing on Strong Summer Demand

Arizona

Monthly Average Spot Index Jumps Over 8% in December with Adult-Use Sales Expected to Begin in March or April 2021

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

25 December 2020.  Copyright © 2020 New Leaf Data Services, LLC.  All rights reserved