The prices of cannabis are on the rise. Throughout 2024, the availability of cannabis flower is becoming increasingly limited as more cultivation operations either reduce or halt production due to escalating losses. This decrease in supply is expected to push prices even higher. As prices rise, some consumers are deterred from making purchases, leading to a heightened demand for Daily Marijuana Canada’s cannabis in numerous areas.
Table of Contents
Key Takeaways:
- As of October 2023, the average price of dried cannabis flower reached $1.10 per gram, reflecting a 6.8% increase from September’s average of $1.03 per gram.
- The cost of recently harvested flower with 20%+ THC surged from $1.04 per gram at the close of last year to $1.32 per gram by April, marking a 27% overall increase.
- With rising cannabis flower prices, consumers are exploring cheaper alternatives such as lower THC flower percentages, online dispensaries for better pricing, or other products.
Canadian Cannabis Market General Trends
A report from the Chicago-based Brightfield Group anticipates that Daily Marijuana Canada’s cannabis market will double within the next five years. The report highlights that the expansion of retail stores and relaxed regulations will contribute to this growth.
According to Brightfield Group, Canada’s cannabis market is projected to expand at a yearly rate of 10%, reaching $8.8 billion in five years. This growth will primarily be propelled 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 substantial potential for further expansion, especially with improved retail access.
Overview of the Flower Market in a Canadian Cannabis Store
Despite anticipated increases in cannabis sales, challenges persist in the cannabis flower market. While cannabis flower continues to lead in sales, its dominance is gradually waning as other categories gain popularity. Wholesale prices have shown relative stability, although some provinces have observed unexpected price hikes.
The average price of dried cannabis flower in October 2023 was $1.10 per gram, indicating a 6.8% rise from September’s average of $1.03 per gram. Year-over-year price changes present even more notable shifts.
Provinces Experiencing Price Increases per THC Level on Newly Harvested Flower
The price of cannabis flowers in Canada varies between newly harvested and aged flowers. Recently harvested flowers tend to sell more rapidly, with the average age of these harvests dropping to just 65 days in April. The average price for aged flowers has largely stagnated, settling at $0.69 per gram in April, reflecting a 1% decrease from the year-end price of $0.70 per gram.
- 30%+ THC: Recently harvested flower saw an average price increase of 2.7%, from $1.81 per gram in March to $1.86 per gram in April.
- 25-30% THC: This category traded at a weighted average price of $1.34 per gram, a 12.6% increase from the March settlement price of $1.19 per gram.
- 20-25% THC: Settled at $0.95 per gram, down 11.2% from the March average price of $1.07 per gram. The cannabis Commodity Exchange (CCX) anticipates a recovery in May, with prices expected to rise by 12.6% to $1.07 per gram.
- 15-20% THC: The average price in April was $0.69 per gram, marking a 23.3% decline from March’s settlement price of $0.90 per gram. However, CCX expects a recovery in May, predicting a 13.0% increase to $0.78 per gram.
Factors Influencing Price Increases
As the cannabis market continues to grow in 2024, several factors are causing fluctuations in cannabis flower prices. Market dynamics and regulatory conditions intersect with these factors.
Supply and Demand
The cultivation yields greatly affect the quantity of cannabis available in the market, influenced by weather, pests, and diseases. Seasonal fluctuations also play a role, with certain times yielding more or less production. For example, outdoor cannabis cultivation peaks during late summer and early fall, leading to an influx of supply that can lower prices.
Consumer preferences can shift due to trends, disposable income changes, and evolving views on cannabis. An increase in demand for cannabis products can drive prices higher, particularly if supply fails to meet the demand. Conversely, a decrease in demand, possibly due to economic downturns or shifts toward alternative products, can lead to lower prices.
Product Diversification
The cannabis market has experienced significant diversification, with consumer interest in a broad range of products beyond traditional recreational cannabis flower. These include edibles, vape pens, pre-rolls, tinctures, and concentrates like live resin. The growing demand for these varied products can influence flower prices.
Technological Integration
The emergence of online shopping platforms for cannabis has simplified the purchasing process for consumers, allowing them to buy a wide variety of products from home. This convenience can boost consumption and affect wholesale demand and prices.
Delivery services have also become increasingly popular, enabling customers to receive cannabis products directly at their homes. The ease of delivery services can enhance demand, particularly in regions where physical dispensaries are less accessible, thereby impacting prices by elevating overall market demand.
Price Increases Drive Demand for Discounted Cannabis; Customers Order Online
With the rise in cannabis flower prices, consumers are actively seeking more affordable options. This includes purchasing lower THC flower, exploring online dispensaries beyond their regions for cost-effective alternatives, or considering different products.
Online cannabis shops provide various THC flower at different price points per gram. Due to their wider customer base, online dispensaries often offer lower prices compared to physical stores. They also run weekly promotions to provide consumers with alternatives if they cannot afford the rising prices of other cannabis flowers.
Below is a list of cannabis buds available at Daily Marijuana Canada for $99 per ounce or 28.35 grams.
Conclusion
Experts forecast continued expansion in the cannabis market, with annual sales on the rise. Despite increasing demand, high-quality cannabis flower, such as hybrid strains, is becoming pricier. Various factors contribute to these price hikes, prompting customers to seek the best prices or explore alternative products like vape cartridges. Online dispensaries offer discounted prices on cannabis flower, enabling customers to meet their needs without compromising on quality or settling for lesser products.
Frequently Asked Questions
Are there any benefits to the price increase for consumers?
While elevated cannabis prices may impose a financial burden, there are significant advantages:
- Improved Product Quality: Higher prices allow producers to invest more in cultivation practices and quality control, resulting in better, safer, and more consistent cannabis products.
- Enhanced Regulation: Rising prices can indicate stronger regulatory oversight, ensuring products meet safety and quality standards, thereby protecting consumers from potentially harmful or substandard goods.
- Economic Benefits: Price increases can boost state revenues through elevated taxes, which can be reinvested into public services. This growth supports 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 promotional sales, bulk purchases, loyalty programs, or by visiting dispensaries recognized for lower pricing. Several provinces also offer medical cannabis programs that provide lower prices for qualifying patients.
What should consumers look for when purchasing discounted cannabis?
When buying lower-priced cannabis, consumers should prioritize quality assurance, lab testing results, reputable brands, and dispensaries with positive customer reviews to ensure they receive safe and effective products.
Related Articles:
