As a major time of the year for the industry (we definitely enjoyed celebrating 4/20 with our Connects users!), April has typically been an active month for wholesale marijuana. Last year we reached record heights for market volume in our network, and this year's 4/20 month was no exception. Marketplace product volume has continued to rise, with 50 new listings hitting Cannabase Marketplace in April alone, marking the second highest wholesale month we've experienced to date.*

This flurry of wholesale activity has sparked some notable developments in Colorado's marijuana wholesale environment. Though these latest developments can be hard spot at first glance, we’ll take a closer look at these here.

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Demand Drives Prices Up

In a rare bit of good news for sellers, prices for wholesale marijuana experienced a modest rebound this April. Crashing prices for wholesale marijuana have been the top Marketplace story for much of the past year, raising fears among sellers facing increased pressure on margins. This sustained price drop finally let up this past month, providing a welcome break for sellers that have weathered an increasingly competitive wholesale environment over the last few months.    

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While prices rebounded slightly across the board, most of the price gains were seen in medical flower, with the average asking price rising nearly 9%, from $2,070/lb in March to $2,223/lb.

Despite the near record-breaking number of listings posted to the Marketplace, sellers have still been able to successfully offload their inventory (and at higher prices!) thanks to a simultaneous boost in demand. Buyers created a record number of wholesale requests in April, fueling a burst in active Marketplace connections and "Sold" listings through the month. Whether this uptick signals that Colorado wholesale marijuana prices have bottomed out remains to be seen, nonetheless, we can expect buyers and sellers to monitor this trend closely in the coming weeks.

Rec and Med Reach Parity

Though prices for recreational flower have always found an equilibrium several hundred dollars over those for medical, this trend has been notably weaker since the end of mandated vertical integration last year. This April however, this long standing rule appears to have finally dissolved.

medical and recreational volume and asking prices for marijuana wholesale

The artificially tight supply created by the now expired 70/30 rule guided higher recreational prices for most of 2014. Though this price disparity has acted as the golden rule for wholesale cannabis in the past, average asking prices for recreational flower have now finally broken the trend and moved down to $2100, 6% lower than those for medical flower.

Wholesale marijuana average asking prices

For the time being, it’s difficult to assess whether last month’s developments are a continuation of the broader trend or merely a short-term anomaly in asking prices. Either way, the effects of a changing pricing paradigm for recreational and medical product will likely reach beyond the wholesale market to consumers.


The Wholesale Marketplace: Looking Forward

With the 4/20 holiday behind us, we can expect to gather a clearer picture of how wholesale trends will continue to develop in coming months. Despite this, we appear to be far from a stable and predictable market. With new businesses steadily joining the market (and Cannabase!), supply and demand fluctuations will continue to make forecasting wholesale prices and activity challenging.  

With Colorado's marijuana wholesale environment remaining volatile, it's more important than ever to be following up-to-date analytics and information. Be sure to follow the Cannabase Marketplace on Twitter and, if you're a licensed business, be sure to subscribe to our in-app Cannalytics for real-time updates and market insights.

*Based on number of listings to hit the market in a 30 day period

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