U.S. Cannabis Spot Index — Published August 26, 2022
The U.S. Cannabis Spot Index increased 1.4% to $1,027 per pound.
The simple average (non-volume weighted) price increased $9 to $1,281 per pound, with 68% of transactions (one standard deviation) in the $544 to $2,017 per pound range. The average reported deal size was unchanged at 2.5 pounds. In grams, the Spot price was $2.26 and the simple average price was $2.82.
The relative transaction frequency of indoor product was unchanged in the week, as were those of greenhouse and outdoor product.
The relative volume of indoor product rose 2%, while that of greenhouse flower fell 2%. Outdoor flower’s relative volume was unchanged.
When asked about the availability of adult use licenses for cannabis business operations in New York, the New York State Office of Cannabis Management (OCM) replied “several foundational tasks need to be completed including issuance and adoption of regulations, hiring and training staff at OCM, and development of infrastructure necessary to accept applications.” Of the adult use licenses that will be issued, the OCM has as a goal of awarding 50% to social equity applicants.
On the local level, New York City Mayor Eric Adams, in cooperation with the city’s Small Business Services, has pledged to help social equity cannabis entrepreneurs through the Cannabis NYC program. In announcing the initiative, Mayor Adams said, “The regulated adult-use cannabis industry is a once-in-a-generation opportunity for our underserved communities that have, for too long, faced disproportionate rates of drug-related incarceration to get in on the industry on the ground floor. Cannabis NYC will plant the seeds for the economy of tomorrow by helping New Yorkers apply for licenses and understand how to open and successfully run a business, while simultaneously rolling equity into our economy by giving those who have been justice-involved and those with a cannabis conviction a chance to succeed. This is about creating good jobs, successful small businesses, and finally delivering equity to communities harmed by the ‘War on Drugs.’”
Initially, Cannabis NYC will offer technical assistance with license applications and “other business services.” The City is expecting 19,000 – 24,000 jobs will be created in the new cannabis industry. In addition to supporting applications for cannabis licenses, the program will “connect aspiring cannabis entrepreneurs to non cost services.” Cannabis NYC expects to expand their program as the industry grows by offering support to “non-plant touching ancillary businesses.”
September 2022 Implied Forward closes unchanged at $1,015 per pound.
The average reported forward deal size was 78 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 52%, 33%, and 15% of forward arrangements, respectively.
The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 83 pounds, 74 pounds, and 63 pounds, respectively.
At $1,015 per pound, the September 2022 Implied Forward represents a discount of 1.2% relative to the current U.S. Spot Price of $1,027 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 and Oklahoma
Cannabis License Moratoriums – Let’s Talk About It: Interviews
Adult Use Licenses – No Date Certain
Medical Cannabis Licenses Cannot be Restricted to State Residents, Court Rules
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Cannabis Benchmarks®, a division of New Leaf Data Services, LLC
26 August 2022. Copyright © 2022 New Leaf Data Services, LLC. All rights reserved