Prices for cannabis are on the rise. As we move through 2024, the availability of cannabis flower is tightening as many cultivation operations reduce or halt production due to increasing losses. This limited supply is expected to push prices even higher. The inflated prices are dissuading some consumers from making purchases, consequently increasing the demand for MMJ Express Canada discounted cannabis options in various regions.
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Key Takeaways:
- As of October 2023, the average price of dried cannabis flower stood at $1.10 per gram, representing a 6.8% increase from $1.03 per gram in September.
- The average price for recently harvested flower containing 20%+ THC surged from $1.04 per gram at the end of the previous year to $1.32 per gram by April, marking a 27% rise.
- With rising cannabis flower prices, consumers are on the lookout for cheaper alternatives, such as lower THC flower, online dispensaries for better deals, or different product types.
Canadian Cannabis Market General Trends
A report by Brightfield Group, an industry consultancy based in Chicago, anticipates that MMJ Express Canada’s cannabis market will double over the next five years. The report highlights that the opening of more retail outlets and relaxed regulations will catalyze this growth.
Brightfield Group forecasts that the cannabis market in Canada will expand at a yearly rate of 10%, reaching $8.8 billion in five years. This growth will mainly stem from increased sales of edibles and vape products.
Bethany Gomez, managing director at Brightfield Group, stated that despite robust market growth in 2021, there remains considerable potential for further expansion, especially with enhanced retail access.
Overview of the Flower Market in A Canadian Cannabis Store
Even with the anticipated rise in cannabis sales, challenges persist within the cannabis flower market. Although cannabis flower still leads in sales, its dominance is gradually diminishing as other categories gain popularity. Wholesale prices have largely remained stable, with some provinces experiencing unexpected hikes.
In October 2023, the average price for dried cannabis flower, according to the latest statistics, was $1.10 per gram, a 6.8% increase from September’s $1.03 per gram. Year-over-year pricing reflects even more notable changes.
Provinces Experiencing a Price Hike per THC Level on Newly Harvested Flower
The cost of cannabis flowers in Canada varies between newly harvested and aged flowers. Recently harvested flowers are selling faster, with their average age dropping to 65 days in April. Conversely, the average price for aged flowers has stagnated at $0.69 per gram in April, reflecting a 1% decrease from the year-end price of $0.70 per gram.
- 30%+ THC: The average price for recently harvested flower rose by 2.7%, from $1.81 per gram in March to $1.86 per gram in April.
- 25-30% THC: This group traded at a weighted average price of $1.34 per gram, a 12.6% increase from March’s price of $1.19 per gram.
- 20-25% THC: The price settled at $0.95 per gram, down 11.2% from March’s 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: The average price for this category was $0.69 per gram in April, a 23.3% decline from March’s $0.90 per gram. CCX anticipates a recovery in May, with a projected increase of 13.0% to $0.78 per gram.
Factors Influencing Price Hike
As the cannabis market expands in 2024, numerous factors are causing fluctuations in cannabis flower prices. Market dynamics and regulatory settings intertwine to influence these factors.
Supply and Demand
The quantity of cannabis available in the market is heavily influenced by cultivation yields, which can fluctuate due to weather, pests, and diseases. Seasonal variations also affect production levels, with outdoor cannabis cultivation peaking during late summer and early fall harvests, leading to an influx of supply that may lower prices.
Consumer preferences can evolve due to trends, changes in disposable income, and shifting perceptions of cannabis. An increase in demand for cannabis products can drive prices up, particularly if supply fails to keep pace. Conversely, a downturn in demand, possibly due to economic challenges or shifts toward alternative products, may lead to lower prices.
Product Diversification
The cannabis market has experienced notable diversification, with consumers expressing 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 varied products can impact flower prices.
Technological Integration
The emergence of online shopping platforms for cannabis products has simplified the purchasing process for consumers, enabling them to buy a wide array of cannabis items from home. This convenience can boost consumption and impact wholesale demand and prices.
Delivery services have also gained traction, allowing customers to receive cannabis products directly at their doorsteps. The convenience of delivery can elevate demand, especially in regions where physical dispensaries are less accessible, thus affecting prices by enhancing overall market demand.
Price Hike Demands for Discounted Cannabis, Customers Order Online
As cannabis flower prices escalate, consumers are increasingly searching for more affordable options. This includes opting for flowers with lower THC levels, exploring online dispensaries outside their area for cheaper alternatives, or considering other product types.
Online cannabis shops provide a variety of THC flowers at diverse price points per gram. With a broader customer base, online dispensaries often offer lower prices than physical stores. They also run weekly sales, offering customers alternatives if they cannot afford rising prices of other cannabis flowers.
Below is a list of cannabis buds available at MMJ Express Canada, priced at $99 per ounce or 28.35 grams.
Conclusion
Experts predict that the cannabis market will continue to grow, with annual sales on the rise. Despite the demand surge, high-quality cannabis flowers, particularly hybrid strains, are becoming pricier. Several factors contribute to these price hikes, leading customers to seek the best prices or explore alternative products such as vape cartridges. Online dispensaries provide discounted cannabis flower options, enabling customers to satisfy 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 higher cannabis prices may impose a financial burden on consumers, several benefits exist:
- Improved Product Quality: Elevated prices allow producers to invest more in cultivation practices and quality control, resulting in superior, safer, and more consistent cannabis products.
- Enhanced Regulation: Rising prices can indicate stronger regulatory oversight, ensuring products meet safety and quality standards, protecting consumers from potentially harmful or substandard goods.
- Economic Benefits: Increased prices can boost state revenues through higher taxes, which can be reinvested in public services. This also promotes 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 locate lower cannabis prices through promotional sales, bulk purchases, loyalty programs, or by shopping at dispensaries known for offering competitive prices. Some provinces have medical cannabis programs that provide lower prices for qualifying patients.
What should consumers look for when purchasing discounted cannabis?
When buying discounted 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.
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