August / September Washington Wholesale Price Analysis

You all know the drill! We’re publishing our data to help the industry see what is happening and where the market is going. Some things are similar to last time, some things are quite different. One major insight over the past 2 months is that we believe the greenhouse market will deeply impact the indoor market. Climate controlled greenhouses with subsidized lighting can produce a similar product to indoor grown product while reducing the cost of goods sold / production cost.

Another insight is that the market continues to react to price competition. I believe a few interesting things have happened over the last 2 months. I have a theory that the price drops may be accidental and due to the inefficiencies in the market. Hear me out.  Imagine a major producer/processor is sitting on a large supply of finished goods ready to go to retail. They’re going to do what any company would do. Temporarily drop their prices to retail to blow through the inventory. Unfortunately, the rest of the industry listens to every move and makes assumptions based on what they hear.

All it takes is one large company doing this to set off a series of unexpected chain reactions. Once one large manufacturer drops their prices, others will think that’s the new bar. They will then push their supply chain to compete. Once the inventory is gone, the original P/P will try to raise their prices again only to find that they have now set a new low bar.

I have no solid evidence that this has happened, but we believe this may be part of an overall trend in the industry. One way to mitigate this problem is to sell excess inventory to another producer/processor. Our request from P/P’s selling into retail is to push prices up slightly and pass price increase on to suppliers. Otherwise supply will shrink, and there will only be a handful of producers willing / able to operate in market. We have built a couple of tools on our platform over the last few months to encourage over bidding and positive price competition.

One of the more charming things that happened on the platform this month was when a seller ended up getting 25% more than asking price on 50lbs of flower. A farm posted inventory at a competitive rate and within 12hrs they had 4 offers at or above asking price from 3 different buyers. Upon further inspection, the buyers were bidding each other up.  This was probably a case of poor pricing by the seller, but they wanted it gone fast. In the end they were super happy to offload the inventory well above asking price and get some cash in the bank. Check that deal out here to see how it happened!

Data Analysis Below:

Supply still outpaces demand:

Supply & Demand

The chart above shows a couple of differences from the last analysis. Last time, interest was double the supply listed. Now, interest has dropped below supply to about 1/2 of what supply was. This is because last time we did this report was the end of July when there was little to no light-dep coming down. This month light-dep harvest has started and farms are listing that supply as soon as they get it. As you can see true demand measured through offers made is about 25% of listed supply. Demand has more than doubled on the platform since we last reported, but listed supply has tripled. Interest has dropped slightly, but we believe that has to do with platform adjustments. We’ve pushed new features to reduce low ball offers and reduce offers on supply that has sold out. Check out those updates here: New Features on Kush Marketplace

Before you jump into the charts below, know that virtually all outdoor flower selling now is almost a year old or older. This means one of two things can happen over the next 2 months. Price could drop on both fresh and older material or Price could rise on fresh material and remain stable for older material. We will update as soon as we have any insights to what will happen once the harvest fully hits the market.

Trim Analysis:


Greenhouse trim has become a substitute for indoor trim. This means their prices have actually gone up. The average deal closed for greenhouse trim for extraction is $0.22/g and $0.54/g for repackaging usually meaning for pre-rolls. Because most of last year’s outdoor trim has sold, the asking price for greenhouse trim rose 33% to $0.40/g. This seems like an odd correlation, but we believe the lack or outdoor trim raised the greenhouse trim prices. Additionally, we believe this is part of an overall trend we expect to see in the next 12 months.

Indoor trim asking price have raised as well, but not much of it has sold because of the price raise. Outdoor Trim prices have remained stable reporting almost the exact same numbers as July. We believe 2017 outdoor trim is mostly sold because if farms didn’t sell, the price decrease on 1yr old trim would drop 40-50%.

Flower Analysis:


Outdoor flower listed price has matched the max interest from last update. Average max interest has dropped from $0.61/g to $0.45/g because many buyers are extracting outdoor flower. Again, this is because of the trim shortage. Offers Made is only down 2 cents to $0.31/g and average price of products receiving Info Requests are down to $0.32/g.

Finally the stats everyone’s been waiting for! Average prices of deals closed.

Flower Statistics on Deals Closed*

Type Low Average High
Outdoor(Repackage) $0.22/g $0.35/g $0.65/g
Outdoor(Extraction) $0.16/g $0.20/g $0.44/g
Greenhouse(Repackage) $0.24/g $0.50/g $1.06/g
Greenhouse(Extraction) $0.21/g $0.22/g $0.23/g
Indoor(Repackage) $0.40/g $0.82/g $1.84/g
Indoor(Extraction) $0.40/g $0.42/g $0.50/g

*Created using over 2700lbs of Flower Deals through the Marketplace. The averages were created using a weighted average taking the total deal size into account.

Trim Statistics on Deals Closed*

Type Low Average High
Outdoor(Extraction) $0.04/g $0.06/g $0.18/g
Greenhouse(Repackage) $0.13/g $0.54/g $0.93/g
Greenhouse(Extraction) $0.07/g $0.14/g $0.22/g

*Created using over 3,820lbs of Trim Deals through the Marketplace. The averages were created using a weighted average taking the total deal size into account.

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