July 9, 2021

U.S. Cannabis Spot Index — July 9, 2021

U.S. Cannabis Spot Index — Published July 9, 2021

U.S. Cannabis Spot Index increased 0.6% to $1,578 per pound.

 

The simple average (non-volume weighted) price increased $3 to $1,841 per pound, with 68% of transactions (one standard deviation) in the $1,056 to $2,627 per pound range. The average reported deal size was nominally unchanged at 2.4 pounds. In grams, the Spot price was $3.48 and the simple average price was $4.06.

 

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

    

 

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

Early reports out of several states indicate that demand in legal cannabis markets is continuing to stabilize and even decrease slightly. Data issued by regulators in Oregon, Massachusetts, and Illinois, examined in this week’s Premium Report, all show declines in monthly retail sales from May to June. This is a departure from historical trends, which have seen monthly revenue figures generally climb from the late spring and through the summer months in prior years. 

 

Plateauing demand is occurring as some cultivators in more mature markets such as Oregon ramped up production compared to last year, while growers in newer adult-use markets like Illinois have expanded to serve demand from general consumers over the past 18 months or so. These dynamics may put downward pressure on, or at least moderate the U.S. Spot Index in the coming months, as opposed to the summer wholesale price rise that Cannabis Benchmarks has observed in each of the past two years. 


Still, the monthly average U.S. Spot price for June 2021 was $1,609 per pound, up 2.4% from May and up 16.4% compared to June 2020. The first two weeks of July have seen the national composite price average $1,574 per pound month-to-date. 

August 2021 Implied Forward unchanged at $1,655 per pound.

 

The average reported forward deal size was 60 pounds. The proportions of forward deals for outdoor, greenhouse, and  indoor-grown flower were 54%, 33%, and 11% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 73 pounds, 48 pounds, and 31 pounds, respectively.

 

At $1,655 per pound, the August Implied Forward represents a premium of 4.9% relative to the current U.S. Spot Price of $1,578 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

Extension of Provisional Licenses Included in Legislation Recently Sent to Governor

Oregon

Demand Declined for the Second Straight Month in June; Harvest Volume Increased

Massachusetts

Adult-Use Sales Reach $105 Million in June, Down 5% from May

Illinois

June Adult-Use Sales Slip Slightly from Prior Month; Data Indicates Retail Prices Are Declining

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

9 July 2021.  Copyright © 2021 New Leaf Data Services, LLC.  All rights reserved