Wholesale CBD, THC Flower & Biomass Prices Are Rough

CBD and THC Flower Prices still in slump as we go into final quarter of 2022

Graphic: Eighth Revolution, a consulting firm

The average spot price in the United State for THC flower dropped to $1058 / lbs., down $10 from last month. In some states like Oregon outdoor flower is selling for as low as $200 a lb. making it impossible for many farmers to stay in business. In Oregon this issue stems from the oversupply of flower in relation to the demand of consumers in the states market.

It would be interesting to see what growers in restricted license markets like Washington state are getting per lb in comparison. Even beyond the licensing structure caused issues there is a drawback overall as consumers spend less in theory, to build saving in case of an economic collapse.

In contrast, the spot price for CBD flower was up 10% to $256 per lb which we imagine stemmed from so many outdoor CBD farmers calling it quits last summer due to ongoing price slumps for the commodity. As we get to August every year, we nearly always see a slight spike in pricing due to a lack of availability. Following there is usually a dip as buyers stop purchasing to wait for the current fall outdoor harvest.

Overall prices for CBD flower have been down throughout the year with many farmers getting around $150 a lb for machine trimmed outdoor, and $175-$200 for greenhouse. Indoor prices have fallen from over $1000 per lb to an average of $600 per lb.

We have witnessed many bulk flower deals at as low as $50 a lb in industry chats and B2B buyer groups struggling to close which is not a good sign.

Leslie Bocskor offers a profound take on Podcast, The Dime, that CBD flower is technically the only legal product nationally in the hemp industry. Every other product is generated from an extraction of the CBD from the plant.

The plant will always have a small amount of THC, typically >1%. But when the plant's cannabinoids are extracted and concentrated into distillate, the THC percentage will nearly always exceed that federal threshold.

There is a remediation process that occurs to bring down the levels of THC in the final extract or product, but this still leaves the intermediary state of the product in question. States such as Colorado allow for the transport of intermediate products in the manufacturing stream (i.e. crude CBD oil) between
interstate operators even if it exceeds the federal limit for THC undoubtedly understanding this pain point.

In everyone mind is to see how the federal governments regulatory bodies will address these types of issues.

The average price for CBD biomass dropped to historical lows of $0.29 per percent per lb, unquestionably causing several operators to hang up their hats. Prices for deals over a million lbs are at an average of .09 per percent per lb and around .47 a percent per lb for purchases under 25k lbs.

The volatility in the CBD biomass market has never been easy. In the first years there was a massive oversupply of CBD extracts as everyone extracted their biomass in an effort to have a shelf stable product to hold as the market leveled. This was in parallel with a dip in consumer demand due to so many bad products duping customers and driving down consumer demand.

Then Delta 8 came in and saved the day as millions of kilos of CBD isolate destined for liquidation from dying businesses were suddenly in desperate demand for the cannabinoids conversions. And then Delta 8 went from $5000 a kilo to $400 as again,, oversupply choked the industry. Catching the theme?

So here we are at the end of 2022 and decreasing prices coupled with increasing input costs to harvest the crop will create a challenging situation come harvest time. We believe there will be price stability in the coming months; however, the industry will experience volatility for the coming years.

CBG biomass prices currently at .37 a percent per lb., have been one of the most stable product categories over the past months according to Hemp Benchmarks.

We, again, believe this is due in part to the smaller market size and different distribution channels. The expansion of the minor cannabinoid market will also continue to provide stability in the short term for CBD distribution until the federal regulations landscape changes surrounding CBD. 

This article was originally written by Eighth Revolution and edited for clarity and to supplement with details towards many of the market pricing statements.