Colorado’s average price of a pound of wholesale marijuana grows for fourth straight quarter
At $999 per pound, state-set average hits highest point since April 2018
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Like a hiker with a fourteener fix, the price of wholesale pot just keeps climbing in Colorado, according to the state statistics.
Between May 1 and July 31, the average price of a pound of dried marijuana sold wholesale to stores hit $999, according to the Colorado Department of Revenue. That’s a nearly $150 jump over the $850 average the state recorded in July.
The $999 average market rate price, a figure used by the state when assessing its 15% excise tax on retail marijuana sales and transfers, takes effect Oct. 1. It marks the fourth straight three-month reporting period during which the cost of bud rose. In October 2018, a pound was going for $759 on average.
The average cost of buds destined to be turned into extract products also rose during the reporting period, hitting $254, up from $227. Whole undried plants rose to $173 per pound from $152 and average seed costs rose to $5 each from $4. The prices of wholesale trim and immature plants were flat at $325 per pound and $8 apiece respectively.
- December 21, 2018 Colorado sees average price of wholesale marijuana rise in second half of 2018
- December 29, 2018 VIDEOS: Understanding where Colorado’s marijuana money goes
- August 6, 2019 More of the legal marijuana sold in Colorado is increasingly for recreational use
The record average price per pound of wholesale bud was set in January 2015 at $2,007, state data shows. The last time the average price per pound was over $1,000 was in April of last year.Between May 1 and July 31, the average price of a pound of dried marijuana sold or transferred from a commercial grow operation in Colorado hit $999.
What’s the weed worth? How police estimate the value of seized drugs
It was the price of the weed that intrigued readers: On Monday, PennLive reported the seizure in York County of 247 pounds of marijuana.
Beyond announcing the arrest of three California men — one of them a sheriff’s deputy — in the bust, the York County District Attorney estimated the value of the seized drugs to be in excess of $2 million.
A lot of readers thought the math didn’t add up.
Wrote one reader:
There is no way that 247 lbs is worth anywhere near ($2) million dollars. Weed costs about $50 per eighth-ounce on the street. If you split that 247 lbs into 31,616 individual units and sold them for $50 each you’d only have $1.58 million. $750,000 tops in its bulk form. You’d only break $2 million if you could sell all of it in tiny individual units and also overcharge everyone by about 25%.
Law enforcement authorities in York County put the estimated value of the 247 pounds of marijuana seized last week in Hanover in excess of $2 million.
Patrick J. Trainor, a spokesman for the U.S. Drug Enforcement Agency’s Philadelphia office, could not disagree, but he argued that not all marijuana is the same.
The domestically grown variety tends to be . well not very good, he said. Some of the extremely high-grade stuff — like the super high-octane product coming out of Canada, for instance – can fetch upwards of $5,000 to $7,000 a pound.
“But several million does sound somewhat inflated,” Trainor said.
Trainor laid out several reasons why District Attorney Tom Kearney’s estimated value may not be excessive. PennLive put a call out to Kearney’s office but was told he was unavailable for comment.
For starters, law enforcement agencies generally assign a retail as well as a street distribution value to seized marijuana, Trainor notes. And while both in the end are correct, they usually report the retail value.
A pure, high-grade cannabis can fetch as much as $5,000-6,000 a pound at the retail level. Drug traffickers — just like any other line of business, Trainor said — make their most money not at the wholesale but the retail. And law enforcement, more often than not, like to report the estimated retail value of the seized cannabis.
“It is entirely possible to take a pound of marijuana and cut that up into nickle bags or dime bags and what we would call a nick traditionally used to sell for $5 to $10 if low grade,” Trainor said. “If it’s high grade, the same bag could retail for $100. You could increase your profit margin by literally 200 percent.”
Then there’s the weed’s place of origin.
The York County Drug Task Force with the help of and police agencies from the region last week seized 247 pounds of marijuana during a traffic stop. Three men, including a sheriff’s deputy from California, have been charged in connection to the seizure. All three posted $1 million bail each. (Ivey DeJesus/PennLive)
Trainor uses the cultured pearls analogy to explain that one: If you want to buy cultured pearls, you are going to get them a lot cheaper in Tahiti than you would in the U.S.
“You are paying premium for those cultured pearls to be cleaned, packaged and delivered to Tiffany’s in Center City or New York. It’s the same thing with drugs,” Trainor said.
The marketplace – or location of sale – will also affect the value of the substance.
Marijuana, Trainor explains, has a significantly higher street value in a place like York County than it would in a large urban center, such as Philadelphia or New York.
“We see a difference in value between Philadelphia and Allentown,” Trainor said. “Speaking from a Philadelphia perspective, you could go to Bucks or Montgomery or Delaware counties and pay more for it there. It’s going to be the same in York County. It’s going to be much more.”
At Monday’s press conference, Kearney declined to provide detail information about the drub, saying the information was part of the ongoing investigation.
Remember that old Cheech and Chong movie. ‘the bigger the bust, the bigger the boost?’ Turns out advocates for the legalization of marijuana are still using that argument.
Cops, they say, like to inflate the value of the seized drugs because it makes them look good.
“They like to hold them out as achievement later to move further up the chain,” said Allen St. Pierre, executive director of the National Organization for the Reform of Marijuana Laws (or NORML).
Almost all — 98 percent — of marijuana arrests in this country happen at the local level, he said. The federal government makes few arrests, he said. Moreover, local departments benefit from millions of federal dollars available through programs such as the Edward Byrne Memorial State and Local Law Enforcement Assistance Program, which St. Pierre describes as a “slush fund” for local law enforcement.
“The general criteria needed is how many busts you make,” he said. “The higher the bust and value, the greater the calculus for local and state police getting a percentage of massive federal grant programs. Local police are really incentivized to do this.”
Advocacy groups like NORML have for decades made inflated estimates a point of contention, and the fact, that, they say, when it comes to prosecuting marijuana cases, police and attorneys lean toward the higher estimated street values and higher weights.
“From a PR point of view it benefits law enforcement, in their view, to put a high dollar value on drugs or contraband,” St. Pierre said. “It’s a notch on their belt in terms of them being able to say ‘we stopped X or Y amount of drugs going from point A to point B or we were able to keep X amount of drugs from your children. specifically your children!”
The fact that fresh — or wet — marijuana weighs more than the dry variety is not lost on police and courts. The drug has a significant drop in weight over a short time.
And while possessing any amount of marijuana is illegal in Pennsylvania, the greater the weight, the greater the potential sentence defendants face.
“When the brass tacks are exposed, it’s really important from a defense point of view to be able to establish the lowest possible weight,” St. Pierre said. “It’s the weight that largely is the determining factor — not the value. That’s the PR. It’s the weight of marijuana along with prior offenses or guns involved..generally speaking the more weight the greater the punishment. Police very often inflate the value of marijuana.”
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