Kush.com is the largest market of it’s kind in all my searches. Prior to this year, before it was federally legal there was a shortage and now every tom dick and jane is trying to get into the gold rush. Those days are rapidly coming to an end.
I think I’ve said this several times in the last few days, but CBD prices are crashing as supply outpaces demand by a minimum 5:1 and on the high side of 10:1
I disagree with this article that the prices will level off at $2300 per kilo and CBD biomass $3.50/lb. I could see Biomass at 10+ % pesticide-free going to $10/kg
Processors who are taking payment in isolate will stop doing so as it becomes more difficult to sell isolate, Mom and Pop farms (under 100 acres) will get crushed as the big guys (500+ acres) have the ability with scale to discount more heavily. Price to produce a KG of isolate for the smaller farmer ranging in the neighborhood of $580-800. Big guys probably sub $300 due to scale.
I’ve seen this in oil market, fracking in 2016 as regulation were coming in and prices for natural gas /oil fell off a cliff many in this space lost their pants. The same will happen with anyone who entered this market in the last 12 months.
Furthermore, there are far more brokers than producers and producers is often a broker. All these companies who have “contracts”, for 500+ kg a month, they will break them, sellers will take them to court and they will declare chapter 11 to break it. whoops. Those contracts don’t mean shit unless they are so iron clad that the seller gets your firstborn if you default.
Thus, in the near terms, those with 99%+ CBD isolate that is pesticide-free cat2 or cat3 tested COAs on single could get $4000 per kg. , 10+ 3500, 100+ $3000 as of today July 17th. However, by the next harvest Croptober, you’ll see that price drop by half. I Really see the bottom of this year on bulk order of CBD isolate to be $1000/kg and singles to be $1800-2000
Luckily, CBD distillate is still a time-consuming process that requires considerable more technical skills and has been overlooked in favor of isolate. I see 90% T free distillate falling to $5-6k by end of the year as prices bottom for an isolate .
- not a single one is ready for the price drop. You don’t know what you don’t know. There is a reason why The oil industry is so niche and has so many different markets. This pipe dream where everyone is going to be vertically integrated most likely won’t happen for 95% of people. If you have 20-30 million minumium you can have a operational refinery that does everything you need it to do and efficiently. Other than that…get good at one thing and one thing only. That is your staying power. Example: ethanol is scarce right now…biofuel plants have been competing for pennies on the dollar and our trade war with China has made us use our corn supply for food. In a normal market 38% of corn goes to ethanol production. For all you Californians this is why your gas is so expensive because no ethanol. Plants are shutting down - even tho they were “players”. Every penny counts and it’s knowing your place in the market. If they practiced network orchestration they would be fine. Don’t be greedy and don’t get to big. Work with each other and you will be fine. That’s where oil and gas got its reputation for being the “good ole boys network” .
