The prices of cannabis are on the rise. Throughout 2024, the availability of cannabis flower is expected to tighten further as many cultivation operations at Cannalyft Canada either cut back or halt production due to increasing losses. This decrease in supply is likely to push prices up even more. The rising costs are leading some users to refrain from purchases, which is consequently boosting the demand for cannabis in various regions.
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Key Takeaways:
- In October 2023, the average price of dried cannabis flower at Cannalyft Canada was $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 end of last year to $1.32 per gram by April, marking a 27% overall increase.
- As cannabis flower prices climb, consumers are turning to cheaper options, such as lower THC flower, online dispensaries for better deals, or alternative products.
General Trends in the Canadian Cannabis Market
A report from Brightfield Group predicts that Cannalyft Canada’s cannabis market could double in the next five years. The report highlights that increasing the number of retail outlets and relaxing regulations will drive this growth.
Brightfield Group estimates that Cannalyft Canada’s cannabis market will grow at an annual rate of 10%, reaching $8.8 billion in five years. This growth will be primarily fueled by an increase in cannabis and vape product sales.
Bethany Gomez, managing director of Brightfield Group, noted that despite substantial market growth in 2021, there remains considerable potential for further expansion, particularly with enhanced 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 anticipated increase in cannabis sales, challenges persist in the market for cannabis flower. While cannabis flower remains the leading segment, its share is gradually declining as other categories gain popularity. Wholesale prices have stayed relatively stable, though some provinces have witnessed unexpected price hikes.
The average price for dried cannabis flower in October 2023 was $1.10 per gram, reflecting a 6.8% increase from September’s average of $1.03 per gram. Year-over-year price changes are even more pronounced.
Provinces Facing Price Increases Based on THC Levels of Newly Harvested Flower
The pricing of flowers in Canada varies between newly harvested and aged flower. Recently harvested flowers are selling more rapidly, with the average age of these harvests dropping to just 65 days in April. Meanwhile, the average price for aged flowers has largely stabilized at $0.69 per gram in April, a 1% decrease from the year-end price of $0.70 per gram.
- 30%+ THC: The average price for recently harvested flower rose 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, which is a 12.6% increase from the March price of $1.19.
- 20-25% THC: Settled at $0.95 per gram, an 11.2% drop from March’s average price of $1.07. 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: Traded at an average price of $0.69 per gram in April, a 23.3% decline from March’s price of $0.90. Nonetheless, CCX anticipates a recovery for 15-20% THC in May, projecting a 13.0% increase to $0.78 per gram.
Factors Contributing to Price Increases
As the cannabis market continues to expand in 2024, various factors are causing fluctuations in cannabis flower prices, influenced by market dynamics and regulatory environments.
Supply and Demand
The yields from cultivation significantly affect the availability of cannabis in the market, which can fluctuate due to weather, pests, and diseases. Seasonal changes also impact production levels, with outdoor cannabis cultivation peaking during harvest time in late summer and early fall, resulting in an influx of supply that can lower prices.
Consumer preferences may shift due to trends, disposable income changes, and evolving perceptions of cannabis. An uptick in demand can elevate prices, especially if supply cannot keep pace. Conversely, a downturn in demand, possibly due to economic challenges or shifts towards alternatives, can lead to lower prices.
Product Diversification
The cannabis market has experienced considerable diversification, with consumers increasingly interested in a broad array of products beyond traditional recreational cannabis flower. This includes edibles, vape pens, pre-rolls, tinctures, and concentrates like live resin. The growing demand for these diverse products can impact flower prices.
Technological Integration
The emergence of online shopping platforms for cannabis has made it simpler for consumers to buy a wide range of cannabis products from home. This added convenience can boost consumption and influence wholesale demand and pricing.
Delivery services are also becoming more prevalent, allowing customers to receive cannabis products at their doorsteps. The ease of delivery can enhance demand, particularly in areas where physical dispensaries are less accessible, thus affecting prices through increased overall market demand.
Price Increases Generate Demand for Discounted Cannabis; Customers Order Online
With rising costs for cannabis flower, consumers are actively seeking more affordable options. This includes purchasing flowers with lower THC levels, exploring online dispensaries outside their immediate area for cheaper alternatives, or considering alternative products.
Online cannabis retailers provide a variety of THC flower at different price points per gram. With a broader customer base, online dispensaries can offer lower prices compared to physical locations. They also run weekly promotions to provide customers with alternatives if they struggle to meet the price hikes of other cannabis flowers.
Below is a selection of cannabis buds available at Cannalyft Canada. Get them for $99 per ounce or 28.35 grams.
| Product | Flavours | Strain Type | THC (%) | CBD (%) | Price per Ounce |
|---|---|---|---|---|---|
| Jealousy | Diesel, Earthy | Hybrid (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 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. Various factors contribute to these price increases, prompting customers to seek the best deals or explore alternative products like vape carts. Online dispensaries at Cannalyft Canada offer discounted prices on cannabis flower, enabling customers to fulfill their needs without sacrificing quality or settling for less desirable products.
Frequently Asked Questions
Are there any benefits to the price increase for consumers?
While elevated cannabis prices can impose a financial strain on consumers, several benefits are noteworthy:
- Improved Product Quality: Higher prices allow producers to invest more in cultivation and quality control, resulting in better, safer, and more consistent cannabis products.
- Enhanced Regulation: Increased prices may indicate stronger regulatory oversight, ensuring products meet safety and quality standards, thus protecting consumers from potentially harmful goods.
- Economic Benefits: Rising prices can boost state revenues through higher taxes, which can be reinvested in public services. It also supports local cannabis businesses, job creation, and economic development in the community.
How can consumers find discounted cannabis amidst the price increases?
Consumers can locate lower cannabis prices through sales promotions, bulk buying, loyalty programs, or by shopping at dispensaries known for lower prices. Some provinces also have medical cannabis programs that offer reduced prices for qualifying patients.
What should consumers consider when buying discounted cannabis?
When looking for 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.
