June 26, 2020

U.S. Cannabis Spot Index — June 26, 2020

U.S. Cannabis Spot Index — Published June 26, 2020

U.S. Cannabis Spot Index up 1.1% to $1,386 per pound.

 

The simple average (non-volume weighted) price increased $6 to $1,552 per pound, with 68% of transactions (one standard deviation) in the $831 to $2,273 per pound range. The average reported deal size was nominally unchanged at 2.1 pounds. In grams, the Spot price was $3.06 and the simple average price was $3.42.

 

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

 

The relative volumes of each grow type were essentially stable from last week.

In prior reports, we have covered the strong demand that has manifested in many legal state cannabis markets across the U.S. during the COVID-19 pandemic, in both medical and adult-use systems. New data out of Washington State shows that sales have spiked to record levels there as well, similar to the situation in its neighbor to the south, Oregon. However, even as new historic sales figures were established in Washington in each month from March to May, wholesale prices in the state have seen a gradual downward trend in that period. 

 

The same can be said for the U.S. Spot Index as a whole. Prior to June, monthly average prices had been on the decline since February. The mean U.S. Spot rate for May was $1,336 per pound, off by 6.2% from February’s monthly average composite price of $1,424 per pound, which is the current peak to this point in 2020. National flower prices have recovered somewhat this month – the mean U.S. Spot rate for June is $1,382 per pound – but for the most part have not yet responded commensurately to the dramatic and unprecedented demand being documented in numerous states.

 

That could change in the coming months if demand remains elevated in most markets. As we documented last year, national wholesale cannabis prices climbed from the late spring to the fall harvest, and beyond. The 2019 wholesale cannabis price recovery occurred even as retailers saw lower sales generally than those that have been reported in recent months.

July Forward closes down $15 at $1,415 per pound.

 

The average reported forward deal size was 35 pounds. The proportions of forward deals for outdoor, greenhouse, and indoor-grown flower were 48%, 33%, and 19% of forward arrangements, respectively. The average forward deal sizes for monthly delivery for outdoor, greenhouse, and indoor-grown flower were 41 pounds, 28 pounds, and 31 pounds, respectively.

 

At $1,415 per pound, the July Forward represents a premium of 2.1% relative to the current U.S. Spot Price of $1,386 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

Los Angeles Cannabis Regulators Seeking to Overhaul City’s Licensing Process

Colorado

State Sales Data Shows YoY Drops in Counties that Receive Significant Tourism; Demand in Suburban Denver Counties More Resilient

 

Adult-Use Cultivators to See Lower Tax Rates on Internal Transfers in Q3

 

Washington

Demand has Spiked During Pandemic with New Sales Records Established Every Month from March to May

Michigan

New Rules Adopted by State Marijuana Regulatory Agency

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

26 June 2020.  Copyright © 2020 New Leaf Data Services, LLC.  All rights reserved