Here’s a look at the latest Wholesale Price by Grow Type for May 2020 from our partners over at Cannabis Benchmarks.
“For the month of May, the Cannabis Benchmarks U.S. Spot Index averaged $1,336 per pound. May is the third consecutive month to see a downturn in the national composite price, despite reports of strong demand and elevated sales out of several states during the COVID-19 pandemic, which began impacting day-to-day life in the U.S. dramatically in March.
While strong demand has been observed across several states, including the sizable markets of Oregon and Arizona, early signs out of Colorado – the nation’s second-largest market after California – suggest that previous sales growth rates slowed in March. We have also discussed how Nevada’s cannabis industry has been especially hard-hit by the measures taken to contain the pandemic. Meanwhile, Massachusetts adult-use retailers, who racked up the sixth-largest revenue total of any state with legal cannabis in 2019, were shuttered completely for two months, with sales only resuming this week.
In other words, while sales out of some larger and mid-sized markets have remained strong, demand in others has been curtailed or appears to have been suppressed somewhat. (April sales out of Colorado, which should be released in June, will provide a clearer picture of the coronavirus’ impact on the state’s cannabis market.)
Additionally, we have not heard reports of any disruptions or slowdowns in supply. No accounts of COVID outbreaks at cannabis cultivation or processing facilities have surfaced to this point, suggesting that production has continued apace during a period of demand fluctuations. Despite reports of occasional runs on cannabis retailers and customers purchasing larger amounts per transaction, wholesale buyers have not evinced anxiety about being able to secure sufficient inventory. The continued prohibition on interstate cannabis commerce may have somewhat insulated each state market from supply chain difficulties that have impacted other industries during the last two unprecedented and unpredictable months.“
Keith Holecek – Managing Director, Cannabis Benchmarks
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