For the week ended Friday, January 6, 2017, the spot price index for a pound of cannabis decreased by 5.1% from $1,615 in the prior week to $1,532. According to the analysts at Cannabis Benchmarks, the simple average price for a gram decreased from $4.04 to $3.88.
The futures price for the near month (February) remained unchanged at $1,625. For the month of March, the forward price also remained unchanged at $1,650. The six-month forward price (July) entered the chart at $1,650 a pound.
About two-thirds of the past week's transactions occurred in a range of $1,223 to $2,295 per pound.
This week the analysts commented on the spot index price:
Viewed in the context of 2016’s wholesale market, the assessment of the July Forward at $1,650 per pound suggests the peak wholesale price for 2017 is anticipated to occur in the month of June. Over the past few years, the wholesale price has typically reached a peak in the August-September-October time frame, as dwindling supplies from the prior year’s outdoor harvest resulted in prices climbing until the surge of newly harvested, dried and cured sun-grown flower reached the market, quickly driving prices to an annual low in October or November. … Last year, however, conventional wisdom was overturned. More greenhouse growers - both existing and new entrants - adopted hybridized four-season cultivation methods using both light augmentation and light deprivation, flooding markets with greenhouse-grown flower in July. As prices started to decline, cultivators of sun-grown flower - who typically sell off about half of their harvest during the fall and parcel out the rest over the remainder of the year - began to realize that they would not be able to secure the higher prices typical of the summer period and flooded the market with their stored inventory, driving prices down further and faster. The result was that the 2016 peak price occurred in late May, four months earlier than the 2015 peak price …. Based upon our analysis and feedback from the field, our conclusion is that last year’s near mid-year peak is indicative of a paradigm shift, and likely to be the new norm until the next significant structural shift in the supply chain.
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Indoor flower prices ranged from $893 to $3,200 per pound, with a median price of $1,900. Greenhouse flower prices ranged from $900 to $2,200 per pound, while the median price was $1,600. Outdoor flower prices ranged from $700 to $1,950 per pound, and the median price was $1,200.
For a wide-angle look at the cannabis industry, see our report on the largest companies in the marijuana business.