Current Data

U.S. Cannabis Spot Index up 0.7% to $1,527 per pound.

The simple average (non-volume weighted) price increased $8 to $1,776 per pound, with 68% of transactions (one standard deviation) in the $963 to $2,589 per pound range. The average reported deal size decreased to 2.1 pounds. In grams, the Spot price was $3.37 and the simple average price was $3.92.

The relative frequency of trades for greenhouse flower increased by about 3% this week. The relative frequency of transactions for indoor product decreased by the same proportion, while that for deals involving outdoor flower was unchanged.  

The relative volume of greenhouse product expanded by roughly 3%. The relative volumes of warehouse and outdoor flower contracted by about 2% and 1%, respectively.

As we have chronicled recently, wholesale cannabis prices have been trending upward since late May on record-setting demand in numerous state markets, including some of the largest and most mature. In recent weeks, the U.S. Spot has risen to its highest point since the first week of 2018, which was the last time prior to mid-July when it was observed to exceed $1,500 per pound. New data out of Michigan this week showed a surge of demand in that market as well, with combined adult-use and medical cannabis sales topping $100 million for the first time. The persistent, outsized demand that has marked legal cannabis systems since the outset of the COVID-19 pandemic in the U.S. is at this point resulting in rumblings about possible shortages in states such as Oregon and Colorado. 

We have also pointed out previously that production in such mature markets has leveled off somewhat in recent years. However, earlier this month a grower in southwestern Oregon reported to Cannabis Benchmarks that outdoor cultivation conditions had been excellent so far this year and that he expected a bumper crop. He speculated that growers up and down the West Coast were having similar experiences. Recent harvest figures out of Oregon suggest expanded mid-summer crops this year, substantiating the grower’s account.

A surge of high-quality supply this fall and winter could blunt the upward trend of the U.S. Spot, especially if a new coronavirus stimulus measure is insufficient or does not come to fruition.