The prices of cannabis are on the rise. As we progress through 2024, the supply of cannabis flower is tightening further, with many cultivation operations either scaling back or halting production due to increasing losses. This diminished supply is expected to push prices even higher. The escalating costs are discouraging some consumers from purchasing, which in turn is amplifying the demand for discounted cannabis at Hush Cannabis Club Canada across various regions.
In 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 THC levels exceeding 20% surged from $1.04 per gram at the end of the previous year to $1.32 per gram by April, marking a 27% overall increase. As cannabis flower prices rise, consumers are increasingly seeking affordable options, such as lower THC flower percentages, online dispensaries for better deals, or alternative products.
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Key Takeaways:
- In October 2023, the average price of dried cannabis flower was $1.10 per gram, marking a 6.8% increase 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 escalate, consumers are looking for cheaper alternatives such as lower THC flower percentages, online dispensaries for better prices, or different products.
Canadian Cannabis Market General Trends
A report from an industry consultancy predicts that Canada’s cannabis market will double within five years. The report highlights that the expansion of retail stores and relaxed regulations will drive this growth. It is projected that Canada’s cannabis market will grow at an annual rate of 10%, reaching $8.8 billion in five years, primarily fueled by increased sales of edibles and vape products.
The managing director of the consultancy stated that despite strong market growth in 2021, there remains considerable potential for further expansion, particularly with improved retail access.
Overview of the Flower Market in A Canadian Cannabis Store
Despite anticipated growth in cannabis sales, challenges persist in the cannabis flower market. While cannabis flower remains the leading sales category, its share is gradually declining as other categories gain popularity. Wholesale prices have stayed relatively stable, although some provinces have seen unexpected price hikes.
The average price for dried cannabis flower in October 2023 was $1.10 per gram, indicating a 6.8% increase from the September average of $1.03 per gram. Year-over-year prices reflect even more significant changes.
Provinces Experiencing a Price Hike per THC Level on Newly Harvested Flower
Prices for cannabis flowers in Canada vary depending on whether they are newly harvested or aged. Recently harvested flowers are selling quickly, and their average age has dropped to 65 days in April. The average price for aged flowers has largely stabilized at $0.69 per gram in April, showing 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, reflecting 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% decline 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% drop from the March settlement price of $0.90 per gram. Nevertheless, CCX anticipates that 15-20% THC will recover in May, with a 13.0% rise to $0.78 per gram.
Factors Influencing Price Hike
As the cannabis market continues to grow in 2024, various factors are affecting fluctuations in cannabis flower prices, intertwining market dynamics and regulatory environments.
Supply and Demand
Yields from cultivation significantly impact the quantity of cannabis available in the market, which can fluctuate due to weather, pests, and diseases. Seasonal variations also affect production levels, with outdoor cannabis cultivation peaking during the late summer and early fall harvest, resulting in an influx of supply that can lower prices.
Shifts in consumer preferences can occur due to trends, changes in disposable income, and evolving attitudes toward cannabis. Increased demand for cannabis products can drive prices up, particularly when supply cannot keep pace. Conversely, a drop in demand, possibly due to economic downturns or a shift toward alternative products, can lead to price reductions.
Product Diversification
The cannabis market has experienced substantial 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 like live resin. The heightened demand for these diverse products can influence flower prices.
Technological Integration
The emergence of online shopping platforms for cannabis products has simplified the purchasing process, allowing consumers to buy a wide array of cannabis products from the comfort of their homes. This convenience can boost consumption and affect wholesale demand and pricing.
Delivery services have also gained traction, enabling customers to receive cannabis products directly at their homes. This delivery convenience can enhance demand, especially in areas where physical dispensaries are less accessible, thus influencing prices by elevating overall market demand.
Price Hike Demands for Discounted Cannabis, Customers Order Online
As the price of cannabis flower increases, consumers are on the lookout for more affordable options. This includes purchasing flower with lower THC levels, exploring online dispensaries outside their areas for cheaper alternatives, or choosing alternative products.
Online cannabis shops provide a variety of THC flower at different price points per gram. With a broader customer base, online dispensaries can offer lower prices than physical stores. They also run weekly sales to provide consumers with alternatives if they cannot afford the price hikes of other cannabis flowers.
At Hush Cannabis Club Canada, you can find cannabis buds on sale, priced at $99 per ounce or 28.35 grams.
Conclusion
Experts anticipate that the cannabis market will keep expanding, with annual sales on the rise. Despite increasing demand, high-quality cannabis flower, such as hybrid strains, is becoming pricier. Multiple factors contribute to these price increases, leading customers to seek the best deals or explore alternative products like vape cartridges. Online dispensaries, such as Hush Cannabis Club Canada, offer discounted prices on cannabis flower, allowing customers to meet their needs without compromising quality or settling for less desirable products.
Frequently Asked Questions
Are there any benefits to the price increase for consumers?
While rising cannabis prices may impose a financial burden on consumers, 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: Increased prices can indicate stronger regulatory oversight, ensuring products meet safety and quality standards, protecting consumers from potentially harmful or substandard goods.
- Economic Benefits: The rise in prices can boost state revenues through higher taxes, which states can reinvest in public services. It also supports the growth of 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 purchasing, loyalty programs, or by shopping at dispensaries known for competitive pricing. Some provinces also have medical cannabis programs that offer 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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