Adam JacksonTHCA hemp flower is emerging as a disruptive force for the cannabis industry, while other industry segments face increasing competition and price fluctuations.
A new report by Hemp Benchmarks, shared with Green Market Report, confirmed wholesale prices for THCA hemp flower have maintained parity with marijuana in several regulated adult-use state markets, keeping it a competitive alternative.
In May, the average wholesale price for THCA hemp flower stood at $922 per pound, higher than seven states, including major markets such as California, Colorado, and Michigan, according to the report.
However, that price was down 10% from April, with indoor, greenhouse, and outdoor grown THCA flower all posting month-over-month price declines, according to the data.
While that would appear to be a significant decline, the product is still holding strong compared to other hemp flower. The report states that “THCA cultivators are able to attract prices three times the average price of CBD flower.” In addition, “THCA remains a high-margin product popular among consumers.”
The rise of autoflower hemp strains could also further affect THCA flower prices – and those across the cannabis-type spectrum, according to Jonathan Rubin, who heads Hemp Benchmarks.
Autoflower hemp begins flowering automatically based on its age, rather than requiring a trigger with changes in the light cycle. Autoflower strains are created by crossbreeding hemp (and marijuana) with Cannabis ruderalis, a subspecies of cannabis that naturally possesses the autoflowering trait.
“The genetics are getting better and better,” Rubin told Green Market Report. “The seed companies that I’m speaking with are telling me that this stuff now is like a true row crop. It’s like corn. Each plant is identical.”
Rubin admits it is not entirely clear whether the price drop in THCA is due to lower demand, higher supply, or increasing adoption of autoflower seeds, especially outdoors, but the movement could be contributing to the decline in flower prices in both hemp and marijuana.
“As more and more autoflower hits the harvest, that means most outdoor growers now, if they’re using autoflower, can have two harvests for summer, and some may be able to get three harvests per summer, depending on their latitude,” Rubin said. “That just means that if you’ve got product inventory and it’s getting older, it’s going to get displaced by newer harvests faster than ever before.”
Regulatory uncertainty around the upcoming Farm Bill could also be motivating hemp growers to sell now.
“People may be saying, ‘Hey, I’ve got product from last year’s harvest or from recent indoor greenhouse harvests, and I’ve got more products coming,’” Rubin said. “’And the Farm Bill could kill our entire business by the end of the year or before the end of the year.’ So, part of it may just be, ‘Hey, sell the product now, we don’t want to be stuck with inventory or leave money on the table in case the FDA does the worst possible thing.’”
While Hemp Benchmarks doesn’t currently break out autoflower seed prices separately, Rubin hinted at potential future coverage due to their pricier nature.
“It’s being widely adopted,” he said. “I couldn’t give you a percentage, but what I can say is, every seed producer that I’ve spoken to that has both traditional seeds and autoflower says that autoflower is selling more.”
