To most industry farmers it is no mystery that CBD isolate has developed into a promising and exciting new market to tap into. However, with new markets, there are often opposing views on what a fair market price really is. Only through data and industry knowledge can these prices be determined. For example, the costs for processing at each step varies depending on what you start with and what kind of extraction process you are using. Therefore, price points will sometime vary, and brokers can take advantage of this, sharing misinformation in order to make a deal.
As Jason from Tweedle Farms, puts it, “the concentrate and extract market is rife with counterfeiters and charlatans – people who aren’t licensed to do what they’re doing”. The high number of illegitimate brokers and players subsequently draws in the scrutiny of the DEA. So being knowledgeable on your isolation processes, laws and market prices are essential to maintaining both good business and good standing in the eyes of law enforcement.
Generally speaking, CBD isolate seems to be independent of the price fluctuations associated with flower and raw material. It is not cheaper during harvest, nor more expensive when it’s not, rather prices are influenced by where the market itself chooses to go. For instance, a growing trend is to extract isolates of different cannabinoids besides THC and CBD, like CBG, and/or CBN. Thus in due time we may see the market move towards cannabinoids that are in even less concentrations than THC and CBD and thus will be more expensive to extract and more expensive to buy.
Currently, the market price for a kilo of isolate averages at $7.5K/Kilo, anywhere between $7,400/Kilo – $7,600/Kilo. Although you may have spoken to a broker looking to purchase it at $4,600/Kilo in the past, these guys are looking to make a steal. Some factors that are involved in determining the prices are the starting material and the type of processing equipment a seller is using. If someone has larger extractors than the competition, they have the capacity to purchase lower grade material in order to extract the same amount of cannabinoids as a smaller extractor using higher grade material. Depending on the yields, one process may be cheaper to extract, permitting a lower sale price than the other. However, this difference in price seems to be within $100.00 of the average, according to the businesses we spoke to, see below.
With the legal status of CBD steadily shifting towards being accepted and incorporated into our health care systems, farmers and processors are actively looking to source and sell their products. It’s quite possible that over the course of a few weeks that the demand for CBD will rapidly increase and then the price point will shift. Particularly if and when the cannabinoid is considered completely legal and a benefit to medical patients across the country in the eyes of our government. CBD is an amazing chemical and it sure to remain a strong market for the foreseeable future.