With CBD Isolate gaining attention within the political and medical sphere, we thought it be a good idea to share some of our insights on CBD Isolate pricing. Many new businesses are forming around the industry of Hemp and Cannabis with goals of riding this wave, so be mindful when preparing deals and reviewing products and costs. Good luck and take note!
Isolate pricing factors:
The foundation for Isolate pricing is Biomass. At this point in time, extractors are buying biomass for around $5.25+ / % / lb for material over 8%. This price has risen since harvest due to a diminishing supply of high quality hemp on the market. This change in biomass pricing is reflected by a 15% price increase in CBD Isolate. As the season continues, I expect to see prices creep up as Biomass becomes less available. Market prices are currently $7,500 / kilo, if you are buying Isolate, it could be a good idea to stock up now.
The cost of processing is directly related to the quality of the material being processed. At lower quality material, <6%, you have to run the process more times for the same CBD content, which adds to your processing costs. Costs seems to hover between 2.50 and 3.00 / gram of isolate output for decent material. Material of a lower quality can be priced per pound of processing – anywhere between $24 – $30 / lb. While for larger lots to be processed, around 10,000+ lb or greater, there are larger and more efficient processing facilities, transportation costs do play a factor here. As even larger facilities come online, low quality hemp will be able to be purchased and processed cheaply, I see this being a factor in the coming year.
The price of isolate can fluctuate based upon supply and demand. The demand for Isolate is growing, with small businesses coming online every day. For example, if there is a 100 kilo supply available, and there is sufficient market demand to sell single kilo lots at $8,000 each – the manufacturer has less incentive to sell 10 kilos at lower price point like $7,000 / kilo.