The Canada Cannabis Spot Index was assessed at C$5.95 per gram this week, up 1.5% from last week’s C$5.87 per gram. This week’s price equates to US$2,128 per pound at the current exchange rate.
This week, Cannabis Benchmarks examined the changing cultivation landscape in Canada. An increasing number of Licensed Producers are shifting production capacity outdoors in an effort to cut costs, with the realization that price wars are inevitable, just as in any other commodity. The latest data from Statistics Canada shows outdoor cultivation capacity expanding at a rapid rate. From October 2019 to October 2020, outdoor cultivation capacity increased by 148%, from 344 to 576 hectares.
In terms of square feet, licensed outdoor production stood at about 62 million as of October 2020, compared to about 22 million square feet of licensed indoor cultivation capacity. It is important to note that the accompanying chart does not represent a direct comparison of actual production by each cultivation type, since indoor operations are able to harvest multiple times annually.
Additionally, while greatly increased outdoor cultivation capacity indicates significant volumes of additional supply in the coming years, much of it will likely go to extraction and product manufacturing.