Marijuana concentrate sales rose more than 40% over the past year and accounted for a larger share of the overall cannabis market as consumers became more familiar with the complicated process of dabbing and new technologies made the products easier to use.
Additionally, due to respiratory health concerns, some consumers are moving away from vape products and turning to concentrates such as wax, hashish, and splinters, according to industry insiders.
Meanwhile, the wholesale price of concentrates, which provide a higher dose of THC than other products like flowers, is rising in light of increased demand.
Seattle-based data analytics firm Headset said sales of marijuana concentrates grew 40.5% last year in the states of California, Colorado, Nevada, and Washington, as well as the recreational and medical markets in Oregon.
The data compares January to November sales in 2020 with the same period in 2019.
Headset defines a concentrate as “a product that is mechanically or chemically obtained from cannabis with a higher cannabinoid potency than the original plant material and is normally intended for smoking or vaporizing”.
The company has a separate category for steam pens so the sector is not included in these statistics.
Total concentrate sales increased from $ 567 million in 2019 to $ 797 million in 2020, according to Headset.
For the same states listed above, the average item price for a wholesale-level concentrate product increased 7.3% from $ 18.35 in 2019 to $ 19.68 in 2020.
According to the Headset, this is likely due in part to more customers choosing 1-gram packs instead of half-gram packs.
For example, in December 2019, 90% of all units sold were 1 gram packages. By December 2020, this share of the unit volume had risen to 96%.
The LeafLink wholesale cannabis market, with offices in Los Angeles and New York, tracks concentrates as follows:
- Living resin
- Moon rocks
- Terp sauce
(See the table above for the state breakdown of LeafLink’s concentrate prices.)
Facts and Factors, a market research organization based in Pune, India, conducted a study that found that the global marijuana concentrate market was valued at $ 1.8 billion in 2019 and is projected to be $ 5.9 billion by 2026. Dollar will reach.
As the legal marijuana markets mature, follow the consumption habits of consumers in those states.
The concentrates category is usually viewed as the next level for the seasoned cannabis connoisseur.
That’s because the products are often very effective – with THC levels of up to 95% compared to 20-35% for flowers – and traditionally require a complicated smoking apparatus, commonly known as a swab device, to consume .
“Heavy consumers who smoke or dab every day are sure to build a tolerance for stronger products over time,” said Mike McDonald, president and CEO of Ammonite of the San Francisco Bay Area, which makes the marijuana hardware dablicator.
He added that his company had seen a trend toward concentrates in both Colorado and California, two of the more mature legal markets in the United States.
According to McDonald, cannabis connoisseurs are always looking for better-tasting, cleaner, and more potent concentrates.
“You are really seeing an appreciation in the market in terms of concentrates,” he added.
Nick Tennant, founder and chief technology officer of Precision Extraction Solutions, a Detroit-based hemp and marijuana extraction company, said concentrates are often a small segment of a new market when it first goes online.
“We tend to see 80% to 20% in favor of flowers in early markets,” he said. “As consumers become more experienced, you see this turnaround.”
According to Tennant, the shift can go up to 65% flowering versus 35% concentrate as the market moves forward.
Katie Bajcar, director of marketing for cannabis extraction company Spherex, based in Aurora, Colorado, agreed, saying that there is a natural transition as consumers become more experienced.
Spherex makes marijuana oil for vape cartridges, dablicators, and infused products, and Bajcar said, “There’s definitely a link between the length of the industry and the types of products consumers are looking for.”
Randy Buchman, CEO of Emerald Growth Partners, which oversees Pleasantrees, a cannabis brand based in Harrison Township, Michigan, said the prices of concentrates go up as more consumers look for them.
One reason, according to Buchman: Ease of use through new wearable technology.
The advent of handheld vaporizers that can burn the various concentrate products makes the products both more convenient and more discreet.
McDonald said the smaller, battery-powered vaporizers helped fuel that trend. A consumer can carry one in a pocket with a 1 gram jar of concentrate, and it is completely portable.
“These are devices that you can toss in your ski jacket,” he added.
Tennant pointed out that as technology advances and more consumers get to try out concentrates, sales will grow accordingly.
“All of these delivery technologies will further catalyze extraction sales,” he added.
Consumers who don’t want to smoke flowers and are suspicious of fumes after the health crisis that began in 2019 are turning to solvent-free extracts like live rosin and resin.
These products contain the properties found in whole marijuana plants beyond THC, including a range of terpenes and smaller cannabinoids. They also usually don’t contain any additives.
“All the vape scare really made people pause and think about what they were taking in their bodies,” Buchman said.
McDonald agreed that the advancement among consumers is toward cleaner marijuana oils and other products.
The challenge with solvent-free products is that they are difficult to scale, he added.
Bajcar agreed that there was great fear of vaping, but as products on the illegal market were identified as culprits, consumers pushed for more cannabis-only products, meaning there were no additives or cutting agents.
“Much of that fear is going away,” she added.
Bart Schaneman can be reached at [email protected]