The CCSI was assessed at C$5.47 per gram this week, down 1.5% from last week’s C$5.55 per gram. This week’s price equates to US$2,008 per pound at the current exchange rate.
As competition intensifies in the cannabis cultivation sector, and a supply surplus continues to depress wholesales prices, Licensed Producers (LPs) continue to shut down already-built indoor growing facilities and scrap future development plans.
As part of the move away from indoor capacity, many Canadian cannabis cultivators are shifting to outdoor operations. The latest data from Statistics Canada shows outdoor cannabis cultivation capacity expanding at a consistent rate, while indoor space has been on a decline since early last year.
As of March 2021, there were 772 hectares licensed to grow cannabis outdoors. This is a massive jump relative to the same period last year. Over the past 12 months, outdoor cannabis cultivation capacity grew by 495 hectares or 179% while indoor cannabis cultivation space has dropped by 10%.
With more farmland dedicated to cannabis, we can expect a larger jump in unpackaged supply come the autumn harvest.
In the past few years, we have seen a 66% month-over-month jump in nationwide production due to the outdoor harvest from September to October. This year, with 772 hectares dedicated to outdoor cannabis growing, we can expect even more production that will put pressure on prices.