The U.S. Cannabis Spot Index averaged $1,562 per pound in 2017, a 13 percent decrease from $1,789 per pound in 2016, according to Cannabis Benchmarks Annual Review & Outlook: 2017-2018 Edition.
The Index declined only 6 percent throughout 2017, opening at $1,532 and closing at $1,436, in contrast to the 20% decline seen in 2016.
Wholesale market for the cannabis flower was $5.7 billion in 2017. For reference, the wholesale wheat market was $7.8 billion. Volume grew by 22%, from 3 million pounds in 2016 to 3.7 million pounds in 2017.
Lowest prices for the year were again seen in November, with the national composite price down 11.6% in Q4 from Q3. Favorable weather conditions led to fall bumper crops, and the combination of outdoor and greenhouse flower hitting the market at the same time helped fuel this in 2017.
The lower level of spot price uncertainty led Cannabis Benchmarks to investigate the volatility of other agricultural commodities. They found that cannabis was in line with the others and that only one, wheat, increased. They believe cannabis volatility decreased in part because of fewer “regulatory and economic surprises.” This may also hold true for Colorado, Washington, and Oregon, although foreseen regulatory actions can greatly affect regional prices.
While it doesn’t have a huge impact on the market, greenhouse flower accounted