July 22, 2022

CANADA CANNABIS SPOT INDEX — July 22, 2022

CANADA CANNABIS SPOT INDEX (CCSI) 

Week Ending July 22, 2022
CCSI image 1 2022-07-22

*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$5.29 per gram this week, down 0.7% from last week’s C$5.33 per gram. This week’s price equates to US$1,861 per pound at the current exchange rate.

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This week we review closures of growing areas by the top Canadian cannabis Licensed Producers (LPs). After the legalization of cannabis in December 2018, the Canadian LPs rushed to build out production capacity, resulting in a heavily overbuilt, oversupplied market. Since January 2020, LPs have continued to shutter indoor, greenhouse, and outdoor operations, with the associated write-offs and lay-offs, in an attempt to right-size operations and improve margins. At some point, the drop in production capacity should help relieve the vast amount of cannabis inventory – both unpackaged and packaged – sitting in warehouses across Canada.

 

The chart below only tracks the operations of the major Canadian cultivators, and in some cases the facilities include a cultivation area and processing / warehouse area.

SOURE: Cannabis Benchmarks, Health Canada

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