A look at licensed growing area in Canada

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The CCSI was assessed at C$5.77 per gram this week, up 0.8% from last week’s C$5.73 per gram. This week’s price equates to US$2,114 per pound at the current exchange rate.

Each week, Business of Cannabis delivers a series of insights from our partners at Cannabis Benchmarks®.

As competition intensifies in the cannabis cultivation sector, an increasing number of Canadian Licensed Producers are shifting production capacity to lower-cost outdoor operations.

As of December 2020, there were 628 hectares licensed to grow cannabis outdoors, an increase of 396 hectares or 170% from a year prior. Outdoor production’s lower cost makes it more competitive with illicit supply, but significant portions of it may not be marketable in its raw form as smokable flower.

However, outdoor-grown cannabis provides large supplies of low-cost raw material for Cannabis 2.0 products such as edibles, beverages, and vapes. Such products are not typically available as readily from illicit sources. More lower-priced Cannabis 2.0 options could bring existing cannabis consumers who are purchasing from the illicit market into the legal one, increasing demand in the regulated system.

Source: Canada Cannabis Spot IndexCannabis Benchmarks

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