The prices of cannabis are on the rise. The availability of cannabis flower is tightening further in 2024 as many cultivation operations reduce or halt production due to increasing losses. This diminished supply is expected to push prices even higher. Elevated prices are deterring some consumers from making purchases, leading to an increased demand for discounted cannabis in various regions, particularly from Coast to Coast Medicinals Canada.
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Key Takeaways:
- In October 2023, the average price of dried cannabis flower was $1.10 per gram, reflecting a 6.8% increase from September’s average of $1.03 per gram.
- The price of freshly harvested flower with 20%+ THC surged from $1.04 per gram at the end of last year to $1.32 per gram by April, marking a total increase of 27%.
- As prices for cannabis flower climb, consumers are seeking cheaper alternatives, such as lower THC flower, online dispensaries for better deals, or different products.
Canadian Cannabis Market General Trends
A report from Brightfield Group, based in Chicago, anticipates that Coast to Coast Medicinals Canada’s cannabis market will double over the next five years. The report highlights that expanding retail stores and easing regulations will drive this growth.
Brightfield Group forecasts that Canada’s cannabis market will grow at an annual rate of 10%, reaching $8.8 billion in five years. This growth will be largely fueled by increased sales of edibles and vape products.
Bethany Gomez, managing director of Brightfield Group, noted that despite robust market growth in 2021, there remains considerable potential for further expansion as retail access increases.
Overview of the Flower Market in A Canadian Cannabis Store
Despite the anticipated surge in cannabis sales, challenges persist in the cannabis flower sector. While cannabis flower continues to dominate market sales, its market share is gradually declining as other categories gain popularity. Wholesale prices have generally remained stable, although certain provinces have seen unexpected increases.
The average price for dried cannabis flower in October 2023, based on the latest data, was $1.10 per gram, a 6.8% rise from the September average of $1.03 per gram. Year-over-year prices reveal even more significant shifts.
Provinces Experiencing a Price Hike per THC Level on Newly Harvested Flower
Prices for cannabis flowers in Canada can differ significantly between newly harvested and aged flowers. The rising prices of recently harvested flowers have been attributed to their faster sales, with the average age of these harvests dropping to just 65 days in April. Conversely, the average price for aged flowers has stagnated at $0.69 per gram in April, which represents a 1% decline from the year-end price of $0.70 per gram.
- 30%+ THC: The average price for recently harvested flower increased by 2.7%, from $1.81 per gram in March to $1.86 per gram in April.
- 25-30% THC: Averaged $1.34 per gram, a 12.6% increase from the March price of $1.19 per gram.
- 20-25% THC: Settled at $0.95 per gram, an 11.2% drop from the March average of $1.07 per gram. The cannabis Commodity Exchange (CCX) predicts a recovery in May, with prices expected to rise by 12.6% to $1.07 per gram.
- 15-20% THC: Averaged $0.69 per gram in April, a decline of 23.3% from the March price of $0.90 per gram. Nonetheless, CCX anticipates a recovery for this category in May, with an expected increase of 13.0% to $0.78 per gram.
Factors Influencing Price Hike
As the cannabis market continues to expand in 2024, various factors are influencing fluctuations in cannabis flower prices, with market dynamics and regulatory frameworks intertwined.
Supply and Demand
The yields from cultivation significantly affect the quantity of cannabis in the market, fluctuating due to weather, pests, and diseases. Seasonal variations also influence production levels. For example, outdoor cannabis cultivation peaks during the late summer and early fall, resulting in an influx of supply that can lower prices.
Consumer trends can shift based on various factors, including disposable income and changing perceptions of cannabis. An increase in demand can drive prices up, especially if supply cannot meet the demand. Conversely, a decrease in demand, perhaps due to economic shifts or a preference for alternative products, can lead to lower prices.
Product Diversification
The cannabis market has seen notable diversification, with consumers increasingly interested in a variety of products beyond traditional recreational cannabis flower. These include edibles, vape pens, pre-rolls, tinctures, and concentrates such as live resin. The rising demand for these diverse products can impact flower prices.
Technological Integration
The growth of online shopping platforms for cannabis products has simplified the purchasing process for consumers, allowing them to buy a wide range of cannabis products from home. This convenience can lead to increased consumption and affect wholesale demand and prices.
Delivery services have also gained popularity, enabling customers to have cannabis products delivered directly to their homes. The ease of delivery can boost demand, particularly in areas where physical dispensaries are less accessible, thereby impacting prices by increasing overall market demand.
Price Hike Demands for Discounted Cannabis, Customers Order Online
As cannabis flower prices rise, consumers are looking for more affordable options. This includes seeking flowers with lower THC levels, exploring online dispensaries for cheaper alternatives, or choosing different products.
Online cannabis retailers offer a variety of THC flower at various price points per gram. With a larger customer base, online dispensaries often provide better prices than physical stores, along with weekly sales to offer customers alternatives amidst rising prices.
Here is a list of cannabis buds available at Coast to Coast Medicinals Canada. Get them for $99 per ounce or 28.35 grams.
Conclusion
Experts predict ongoing expansion in the cannabis market, with annual sales projected to rise. However, high-quality cannabis flower, including hybrid strains, is becoming increasingly costly. Various factors contribute to these price increases, leading customers to seek the best deals or explore alternative products like vape carts. Online dispensaries provide discounted prices on cannabis flower, enabling customers to fulfill their needs without sacrificing quality or settling for less desirable products.
Frequently Asked Questions
Are there any benefits to the price increase for consumers?
Although higher cannabis prices can strain consumer finances, there are several benefits:
- Improved Product Quality: Increased prices allow producers to invest more in cultivation and quality control, resulting in safer, higher-quality cannabis products.
- Enhanced Regulation: Rising prices may indicate stronger regulatory oversight, ensuring products meet safety and quality standards, protecting consumers from harmful goods.
- Economic Benefits: Price increases can boost state revenues through higher taxes, which can be reinvested in public services. They also promote local cannabis businesses, job creation, and community economic development.
How can consumers find discounted cannabis in light of the price increase?
Consumers can discover lower cannabis prices through promotions, bulk buying, loyalty programs, or by shopping at dispensaries known for lower prices. Some provinces have medical cannabis programs offering reduced prices for qualifying patients.
What should consumers look for when purchasing discounted cannabis?
When seeking lower cannabis prices, consumers should prioritize quality assurance, lab testing results, reputable brands, and dispensaries with positive customer reviews to ensure they receive safe and effective products.
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