U.S. Cannabis Spot Index up 0.6% to $1,522 per pound.
The simple average (non-volume weighted) price increased $7 to $1,768 per pound, with 68% of transactions (one standard deviation) in the $986 to $2,550 per pound range. The average reported deal size was 2.3 pounds. In grams, the Spot price was $3.35 and the simple average price was $3.90.
The relative frequency of trades for indoor flower increased by 1%. The relative frequency of deals for outdoor product decreased by the same proportion, while that for greenhouse flower was unchanged.
The relative volume of outdoor flower contracted by 3% this week. The relative volumes of warehouse and greenhouse product expanded by 2% and 1%, respectively.
Based on new sales data out of several states – both those with established and newer markets – the March sales spike that has come to be expected based on observations from prior years manifested again in 2021. Oregon, Illinois, and Massachusetts all saw new record monthly retail revenue figures established last month.
Notably, adult-use sales alone out of the latter two states are now comparable to those generated by Oregon’s licensed system, which also serves registered patients. Total retail sales in Illinois were about $35 million more than those documented in Oregon in March, which marked just the fifteenth month that Illinois’ legal adult-use market has been up and running, compared to Oregon’s four-and-a-half year old licensed system. The rapid growth in sales in Illinois presages the additional demand that will be captured by legal cannabis markets in other high-population states such as New Jersey and New York when those markets open for business.
At the moment, robust demand in state-legal cannabis markets has not resulted in rising wholesale prices. However, this follows the observed behavior of the U.S. Spot in 2020, which declined by 3% from February to March, then decreased another 1% from March to April, even while sales began to boom unexpectedly as the COVID-19 pandemic took hold of the country. This year’s decline in the monthly average national composite price from February to March was much smaller, at 0.3%. Meanwhile, March 2021’s mean U.S. Spot price of $1,508 per pound is up by 9.2% year-over-year, from $1,381 in March 2020.
May 2021 Implied Forward unchanged at $1,550 per pound.
The average reported forward deal size was 47 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 54%, 34%, and 12% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 59 pounds, 35 pounds, and 25 pounds, respectively.
At $1,550 per pound, the May Implied Forward represents a premium of 1.9% relative to the current U.S. Spot Price of $1,522 per pound. The premium or discount for each Forward price, relative to the U.S. Spot Index, is illustrated in the table below.
March Sales Jump 23% to Exceed $109M, a New Record
Adult-Use Sales Top $100M for the First Time Ever in March
Combined Medical and Adult-Use Revenues Approach $145M in March, Establishing a New Record High
March Adult-Use Sales Grow by 47% MoM, But Remain Modest at $3.7M