June 10, 2021

U.S. Cannabis Spot Index — June 11, 2021

U.S. Cannabis Spot Index — Published June 11, 2021

U.S. Cannabis Spot Index declined 1.2% to $1,596 per pound.

 

The simple average (non-volume weighted) price decreased $6 to $1,818 per pound, with 68% of transactions (one standard deviation) in the $1,042 to $2,594 per pound range. The average reported deal size was nominally unchanged at 2.4 pounds. In grams, the Spot price was $3.52 and the simple average price was $4.01.

 

The relative frequencies of transactions for each grow type were relatively stable from last week.     

 

 

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

The U.S. Spot Index was generally on the rise last month, as well as being up relative to April. The national composite price averaged $1,572 per pound in May, an increase of 2.9% from the prior month. May 2021’s mean U.S. Spot price is also up 17.7% year-over-year, from $1,336 per pound in May 2020. 

 

We noted in a recent report that retail sales in the 10 largest markets for which Cannabis Benchmarks assesses wholesale prices were up over 50% year-over-year in both March and April 2021. Early May sales data out of some states indicates that elevated demand is persisting. However, there are some signs that demand could be leveling off based on recently-released sales figures. 

 

 

In Oregon, for example, retail revenues fell from April to May 2021, breaking with the trend of increasing monthly sales in that span in each year from 2017 through 2020. Meanwhile, in Illinois, although total monthly adult-use sales increased month-over-month in May, average daily retail revenues in that sector of the state’s market declined last month for the first time in over a year.

July 2021 Implied Forward up $15 at $1,630 per pound.

 

The average reported forward deal size was 53.4 pounds. The proportions of forward deals for outdoor, greenhouse, and  indoor-grown flower were 52%, 36%, and 12% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 67 pounds, 42 pounds, and 29 pounds, respectively.

 

At $1,630 per pound, the July Implied Forward represents a premium of 2.1% relative to the current U.S. Spot Price of $1,596 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

Tax Department Data Shows Volume of Wholesale Flower Entering the Licensed System Expanded by 69% from 2019-2020

Colorado

Consumer and Patient Demand Remained Strong in April, with Combined Sales Off Only Slightly from March

Massachusetts

Adult-Use Sales Climb to a New Record of $110 Million in May, but Growth in Average Daily Sales Slowed

Oklahoma

Medical Cannabis Dispensaries Tally over $85 Million in Sales in April; Sales and Patient Counts Have Stabilized Recently

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

11 June 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

June 4, 2021

U.S. Cannabis Spot Index — June 4, 2021

U.S. Cannabis Spot Index — Published June 4, 2021

U.S. Cannabis Spot Index up 2.1% to $1,616 per pound.

 

The simple average (non-volume weighted) price increased $12 to $1,824 per pound, with 68% of transactions (one standard deviation) in the $1,047 to $2,601 per pound range. The average reported deal size was nominally unchanged at 2.4 pounds. In grams, the Spot price was $3.56 and the simple average price was $4.02.

 

The relative frequency of transactions for greenhouse flower decreased by almost 2%. The relative frequency of deals for indoor product increased by the same proportion, while that for trades for outdoor flower was stable. 

    

 

The relative volume of outdoor flower contracted by 3% this week. The relative volume of warehouse product expanded by the same proportion, while that for greenhouse flower was unchanged.

The U.S. Spot Index was generally on the rise last month, as well as being up relative to April. The national composite price averaged $1,572 per pound in May, an increase of 2.9% from the prior month. May 2021’s mean U.S. Spot price is also up 17.7% year-over-year, from $1,336 per pound in May 2020. 

 

We noted in a recent report that retail sales in the 10 largest markets for which Cannabis Benchmarks assesses wholesale prices were up over 50% year-over-year in both March and April 2021. Early May sales data out of some states indicates that elevated demand is persisting. However, there are some signs that demand could be leveling off based on recently-released sales figures. 

 

 

In Oregon, for example, retail revenues fell from April to May 2021, breaking with the trend of increasing monthly sales in that span in each year from 2017 through 2020. Meanwhile, in Illinois, although total monthly adult-use sales increased month-over-month in May, average daily retail revenues in that sector of the state’s market declined last month for the first time in over a year.

December 2021 Implied Forward initially assessed at $1,610 per pound.

 

The average reported forward deal size was 52.9 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 66 pounds, 42 pounds, and 29 pounds, respectively.

 

At $1,615 per pound, the July Implied Forward represents a discount of 0.1% relative to the current U.S. Spot Price of $1,616 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:

Oregon

Monthly Sales Decrease from April to May for the First Time in Four Years, but Still Exceed $105 Million

Nevada

Legal Sales Boomed in March, Rising to a New Record of Almost $97 Million

Arizona

Report: Preliminary Tax Data Puts Combined Adult-Use and Medical Cannabis Sales at Roughly $120 Million in March

Illinois

May’s Adult-Use Sales Set Another Record, but Average Daily Sales Declined for the First Time in Over a Year

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

4 June 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

May 28, 2021

U.S. Cannabis Spot Index — May 28, 2021

U.S. Cannabis Spot Index — Published May 28, 2021

U.S. Cannabis Spot Index up 0.9% to $1,583 per pound.

 

The simple average (non-volume weighted) price increased $11 to $1,813 per pound, with 68% of transactions (one standard deviation) in the $1,045 to $2,580 per pound range. The average reported deal size increased to 2.4 pounds. In grams, the Spot price was $3.49 and the simple average price was $4.00.

 

The relative frequency of transactions for outdoor flower decreased by almost 3%. The relative frequencies of deals for indoor and greenhouse product increased by about 2% and 1%, respectively.    

 

 

The relative volume of outdoor flower contracted by 2% this week. The relative volumes of indoor and greenhouse product expanded by 1% each.

Cannabis Benchmarks has followed demand trends in the major markets we cover for several years. As we have documented for in excess of the past year, retail sales in legal cannabis markets across the U.S. boomed beginning in March 2020, as consumers and medical patients accelerated their purchasing from licensed outlets during the COVID-19 pandemic. Additionally, new adult-use systems in populous states like Michigan and Illinois began ramping up after opening in late 2019 and the beginning of 2020, respectively. 

 

Collective monthly retail revenue tallies from the 10 states with the largest markets for which Cannabis Benchmarks provides price assessments – California, Colorado, Oregon, Washington, Nevada, Michigan, Illinois, Massachusetts, Arizona, and Oklahoma – illustrate the dramatic expansion of cannabis demand captured by legal markets from 2020 to 2021. The following figures are derived primarily from official state data, but also include Cannabis Benchmarks estimates, and, in the case of monthly sales figures for California and Washington, research from Hedgeye Risk Management. 

 

In March 2020, combined retail sales from the 10 markets noted above totaled $1.01 billion. A year later, March 2021 saw the legal cannabis systems in the same states generate $1.53 billion in sales, a 51.5% year-over-year increase. 

 

April 2020 saw nine of the 10 states listed above combine to generate $993.2 million in retail revenue (adult-use retailers in Massachusetts were compelled to close in April 2020 as part of the state’s COVID-19 response), a figure that we estimate will rise to about $1.56 billion in April 2021, once sales from all states under discussion are documented. This would represent a 57.1% year-over-year spike. 

 

Many of the aforementioned markets saw sales records established in the early months of the pandemic. The sales data above shows that demand continued to grow to even more elevated levels, where it has stayed. Yet, even as demand expanded dramatically and rapidly, the year-over-year increase in the national composite wholesale flower price in the same period has not matched the magnitude of the sales boom. From March 2020 to March 2021, the monthly average U.S. Spot price rose by 9.2% from $1,381 to $1,508 per pound. The national volume-weighted composite price climbed by 11.7% from April 2020 to April 2021, from $1,367 to $1,527 per pound, a rate of increase that is only about one-fifth of that observed in the retail revenue data. 

June 2021 Implied Forward closes at $1,585 per pound.

 

The average reported forward deal size was 51.8 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 65 pounds, 41 pounds, and 29 pounds, respectively.

 

At $1,585 per pound, the June Implied Forward represents a premium of 0.1% relative to the current U.S. Spot Price of $1,583 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

Report: New Licensed Retailers Begin to Open in Los Angeles

Illinois

Legislation to Create and Issue Additional Retail Licenses Approved by State House of Representatives

New Mexico

Regulators Publish Draft Rules for Adult-Use Producers

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

28 May 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

May 21, 2021

U.S. Cannabis Spot Index — May 21, 2021

U.S. Cannabis Spot Index — Published May 21, 2021

U.S. Cannabis Spot Index down 0.1% to $1,568 per pound.

 

The simple average (non-volume weighted) price increased $4 to $1,802 per pound, with 68% of transactions (one standard deviation) in the $1,027 to $2,577 per pound range. The average reported deal size was nominally unchanged at 2.3 pounds. In grams, the Spot price was $3.46 and the simple average price was $3.97.

 

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

 

 

The relative volume of greenhouse flower expanded by almost 3% this week. The relative volumes of indoor and outdoor product contracted by about 2% and 1%, respectively.

Cannabis Benchmarks has followed demand trends in the major markets we cover for several years. As we have documented for in excess of the past year, retail sales in legal cannabis markets across the U.S. boomed beginning in March 2020, as consumers and medical patients accelerated their purchasing from licensed outlets during the COVID-19 pandemic. Additionally, new adult-use systems in populous states like Michigan and Illinois began ramping up after opening in late 2019 and the beginning of 2020, respectively. 

 

Collective monthly retail revenue tallies from the 10 states with the largest markets for which Cannabis Benchmarks provides price assessments – California, Colorado, Oregon, Washington, Nevada, Michigan, Illinois, Massachusetts, Arizona, and Oklahoma – illustrate the dramatic expansion of cannabis demand captured by legal markets from 2020 to 2021. The following figures are derived primarily from official state data, but also include Cannabis Benchmarks estimates, and, in the case of monthly sales figures for California and Washington, research from Hedgeye Risk Management. 

 

In March 2020, combined retail sales from the 10 markets noted above totaled $1.01 billion. A year later, March 2021 saw the legal cannabis systems in the same states generate $1.53 billion in sales, a 51.5% year-over-year increase. 

 

April 2020 saw nine of the 10 states listed above combine to generate $993.2 million in retail revenue (adult-use retailers in Massachusetts were compelled to close in April 2020 as part of the state’s COVID-19 response), a figure that we estimate will rise to about $1.56 billion in April 2021, once sales from all states under discussion are documented. This would represent a 57.1% year-over-year spike. 

 

Many of the aforementioned markets saw sales records established in the early months of the pandemic. The sales data above shows that demand continued to grow to even more elevated levels, where it has stayed. Yet, even as demand expanded dramatically and rapidly, the year-over-year increase in the national composite wholesale flower price in the same period has not matched the magnitude of the sales boom. From March 2020 to March 2021, the monthly average U.S. Spot price rose by 9.2% from $1,381 to $1,508 per pound. The national volume-weighted composite price climbed by 11.7% from April 2020 to April 2021, from $1,367 to $1,527 per pound, a rate of increase that is only about one-fifth of that observed in the retail revenue data. 

June 2021 Implied Forward unchanged at $1,585 per pound.

 

The average reported forward deal size was 51.7 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 53%, 35%, and 12% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 65 pounds, 41 pounds, and 27 pounds, respectively.

 

At $1,585 per pound, the June Implied Forward represents a premium of 1.1% relative to the current U.S. Spot Price of $1,568 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:

National

10 Largest Markets for Which Cannabis Benchmarks Assesses Prices Tally Over $1.5 Billion in Combined Sales in Both March & April 2021, Up Over 50% YoY

Colorado

New Bill Would Limit Concentrate Purchasing by Registered Patients, Impose New Packaging Requirements for Concentrates in Medical and Adult-Use Markets

Michigan

April’s Combined Adult-Use and Medical Sales Climb to New Record of Over $153 Million

Legalization Updates

Montana Governor Signs Bill to Implement Adult-Use Legalization; Sales to Begin January 2022

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

21 May 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved

May 14, 2021

U.S. Cannabis Spot Index — May 14, 2021

U.S. Cannabis Spot Index — Published May 14, 2021

U.S. Cannabis Spot Index up 0.4% to $1,571 per pound.

 

The simple average (non-volume weighted) price increased $36 to $1,798 per pound, with 68% of transactions (one standard deviation) in the $1,027 to $2,568 per pound range. The average reported deal size was 2.3 pounds. In grams, the Spot price was $3.46 and the simple average price was $3.96.

 

The relative frequency of transactions for greenhouse flower increased by 2% this week. The relative frequencies of deals for indoor and outdoor product contracted by 1% each.

   

 

The relative volume of greenhouse flower expanded by 1% this week. That for outdoor product contracted correspondingly, while the relative volume of warehouse flower was unchanged.

Prior to this week, the recent upward trend of the U.S. Spot Index has been driven primarily by rising wholesale flower prices in California, which is by far the country’s largest market. Apart from Nevada, rates for flower in other large state cannabis markets in the western U.S. have been observed to be relatively stable or trending down. Additionally, Michigan’s state Spot price is on the downswing as production continues to expand. Similarly, composite prices in Illinois and Massachusetts are down compared to the end of 2020. 

 

In this week’s Premium Report, we detail tax collection data that shows the large expansion that took place in the Golden State’s licensed system in 2020. Interestingly, the data shows that less product entered the state’s wholesale market in Q4 than in Q3 2020, despite the autumn harvest taking place in the final quarter of the year. 

 

 

Whether this observation reflects a smaller outdoor crop remains to be seen; 2021 data has not yet been made available. Last year’s harvest may have been slow to be sold into the regulated market, as tax data indicates that demand in California subsided in Q4 2020 as well. In previous reports, we noted that accounts from market participants suggested that the state’s fall crop was largely spared from the record-setting wildfires that burned parts of the Emerald Triangle. In Oregon, growers collectively posted record-setting harvest numbers despite facing the same adversity and wholesale flower prices have begun to trend upward slightly in recent weeks.

June 2021 Implied Forward unchanged at $1,585 per pound.

 

The average reported forward deal size was 52.1 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 54%, 33%, and 13% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 65 pounds, 41 pounds, and 27 pounds, respectively.

 

At $1,585 per pound, the June Implied Forward represents a premium of 0.9% relative to the current U.S. Spot Price of $1,571 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

State Cannabis Tax Collections Increased 63% from 2019 to 2020

Colorado

Total Year-to-Date Sales Through March Up 28% Compared to Q1 2020, Outpacing Last Year’s Accelerated Growth During COVID

Arizona

Sales Volume of Concentrates, Extracts in Medical Market Continued to Grow in April as Other Product Categories Saw Declines

Oklahoma

March’s Medical Cannabis Sales Rise to Over $89M as Patient Count Has Plateaued and Declined Slightly in Recent Months

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

14 May 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved