Cannabis prices continue to rise. The supply of cannabis flower tightens further throughout 2024 as more cultivation operations either reduce or cease production due to mounting losses. This reduced supply will likely drive prices even higher. Higher prices are discouraging some users from purchasing, which in turn is increasing the demand for discounted cannabis in many regions.
Table of Contents
Key Takeaways:
- In October 2023, the average price of dried cannabis flower was $1.10 per gram, up 6.8% from September’s average of $1.03 per gram.
- The price of recently harvested flower with 20%+ THC rose from $1.04 per gram at the end of last year to $1.32 per gram by April, a 27% increase overall.
- As cannabis flower prices rise, consumers seek cheaper options such as lower THC flower percentage, online dispensaries for better prices, or alternative products.
Canadian Cannabis Market General Trends
A Chicago-based industry consultancy Brightfield Group report expects Canada’s cannabis market to double over the next five years. The report emphasizes that opening more retail stores and loosening regulations will fuel this growth.
Brightfield Group projects that Canada’s cannabis market will grow at a yearly rate of 10% and $8.8 billion in five years. This increase will be driven primarily by higher sales of edibles and vape products.
Bethany Gomez, managing director of Brightfield Group, said that despite strong market growth in 2021, there is still significant potential for further expansion, especially with increased retail access.
| Year | Forecast Total Sales |
| 2020 | $3.2B |
| 2021 | $4.4B |
| 2022 | $5.5B |
| 2023 | $6.4B |
| 2024 | $7.2B |
| 2025 | $7.9B |
| 2026 | $8.5B |
| 2027 | $8.8B |
Overview of the Flower Market in A Canadian Cannabis Store
Despite the predicted increase in cannabis sales, challenges remain in the market for cannabis flower. While cannabis flower still leads market sales, its dominance is slowly declining as other categories gain traction. Wholesale prices have remained relatively stable, with some provinces experiencing unexpected price increases.
The average price for dried cannabis flower in October 2023, based on the most recent data, was $1.10 per gram. This marks a 6.8% increase from the September average of $1.03 per gram. Year-over-year prices show even more significant changes.
Provinces Experiencing a Price Hike per THC Level on Newly Harvested Flower
The price of flowers in Canada can vary from newly harvested to aged flower. Driving this price increase, recently harvested have been selling more quickly, with the average age of these harvests falling to a low of 65 days in April. The average price for aged flowers has largely stagnated and settled at $0.69 per gram in April, which represents a 1% decrease 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: 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, an 11.2% drop from the March average price of $1.07 per gram. The Cannabis Commodity Exchange (CCX) has forecasted a recovery in May, with prices expected to rise by 12.6% to $1.07 per gram.
- 15-20% THC: Traded at an average price of $0.69 per gram in April, a 23.3% decline from the March settlement price of $0.90 per gram. Despite this, CCX expects 15-20% THC to recover in May, with a 13.0% increase to $0.78 per gram.
| THC Level | British Columbia | Alberta | Ontario | Quebec | Rest of Canada |
| 30%+ | $1.48 | $1.56 | $1.63 | $1.95 | $2.23 |
| 25%-30% | $1.27 | $1.30 | $1.08 | $1.19 | $0.88 |
| 20%-25% | $1.09 | $0.99 | $0.98 | $0.70 | $0.67 |
| 20%-15% | – | $1.00 | $0.78 | $0.46 | $0.67 |
Factors Influencing Price Hike
As the cannabis market continues to expand in 2024, various factors are contributing to fluctuations in cannabis flower prices. Market dynamics and regulatory environments intertwine with these factors.
Supply and Demand
Cultivation yields heavily influence the quantity of cannabis available in the market, which varies due to weather conditions, pests, and diseases. Seasonal variations also play a role, with certain times of the year yielding higher or lower production levels. For instance, outdoor cannabis cultivation peaks during the harvest time in late summer and early fall, which leads to an influx of supply that can lower prices.
Consumer preferences can shift due to trends, changes in disposable income, and evolving perceptions of cannabis. An increase in demand for cannabis products can drive up prices, especially if the supply cannot keep pace. A decrease in demand, possibly due to economic downturns or shifts towards alternative products, can lead to lower prices.
Product Diversification
The cannabis market has seen significant diversification, with consumers showing interest in a wide range of products beyond traditional recreational cannabis flower. These products include edibles, vape pens, pre-rolls, tinctures, and concentrates like live resin. The increased demand for these varied products can impact flower prices.
Technological Integration
The rise of online shopping platforms for cannabis products has made it easier for consumers to purchase a huge variety of cannabis products from the comfort of their homes. This convenience can increase consumption and affect wholesale demand and prices.
Delivery services have also become more prominent, so customers receive cannabis products directly at their doorsteps. The convenience of delivery services can boost demand, especially in regions where physical dispensaries are less accessible, thus impacting prices by increasing overall market demand.
Price Hike Demands for Discounted Cannabis, Customers Order Online
As the cost of cannabis flower rises, consumers are seeking more affordable options. This includes purchasing flower with lower THC levels, exploring online dispensaries outside their region for cheaper alternatives, or opting for alternative products.
Online cannabis shops offer a variety of THC flower at different price points per gram. Due to the broader customer base, online dispensaries offer lower prices than physical stores. They also provide weekly sales to give customers an alternative if they cannot afford the price increases of other cannabis flowers.
Below is a list of cannabis buds that are on sale at GrassLife. Get $99 per ounce or 28.35 grams.
| Product | Flavours | Strain Type | THC (%) | CBD (%) | Price per Ounce |
|---|---|---|---|---|---|
| Jealousy | Diesel, Earthy | Hybrid strain (Balanced) | 24 | 0.2 | $99 |
| Biscotti | Cookies, Diesel | Hybrid (Indica Dominant) | 21 | 0.4 | $95 |
| Purple Truffle | Berry, Citrus, Sweet | Hybrid (Indica-dominant) | 20% | – | $99 |
Conclusion
Experts predict that the cannabis market will continue to expand, with annual sales increasing. Despite rising demand, high-quality cannabis flower, such as hybrid strains, are becoming more expensive. Several factors contribute to these price increases, so customers seek the best prices or explore alternative products like vape carts. Online dispensaries offer discounted prices on cannabis flower, which allows customers to meet their needs without compromising on quality or settling for undesired products.
Frequently Asked Questions
Are there any benefits to the price increase for consumers?
While higher cannabis prices can place a financial burden on consumers, there are notable benefits:
- Improved Product Quality: Higher prices enable producers to invest more in cultivation practices and quality control, which leads to better, safer, and more consistent cannabis products.
- Enhanced Regulation: Increased prices can signal stronger regulatory oversight, which ensures that products meet safety and quality standards and protects consumers from potentially harmful or substandard goods.
- Economic Benefits: The rise in prices can increase state revenues through higher taxes, which states can reinvest in public services. It also fosters the growth of local cannabis businesses, job creation, and economic development within the community.
How can consumers find discounted cannabis in light of the price increase?
Consumers can find lower cannabis prices through sales promotions, bulk purchasing, loyalty programs, or by shopping at dispensaries known for lower prices. Some provinces also have medical cannabis programs that offer lower prices for qualifying patients.
What should consumers look for when purchasing discounted cannabis?
When purchasing lower cannabis prices, consumers must look for quality assurance, lab testing results, reputable brands, and dispensaries with good customer reviews to ensure they are still getting safe and effective products.
Related Articles:
