Legalizing marijuana was one of Canadian Prime Minister Justin Trudeau’s most controversial campaign promises. It helped him win the youth vote in the 2015 election.
Under the bill’s provisions, the country’s federal government will oversee supply and licensing of marijuana. Canada’s provinces would then decide how marijuana should be distributed and sold. Provinces will also set prices.
Canada’s pending marijuana legalization at the federal level isn’t much of a surprise to the country’s citizens. But investors have mostly ignored this important cannabis milestone.
Instead, cannabis investors have set their sights on the U.S. market and state marijuana mandates.
But these triple digit returns are becoming harder and harder to come by in the U.S. The cannabis bull market has stalled. It may even be dying.
That’s because U.S. Attorney General, Jeff Sessions has publicly opposed state marijuana legislation. Since marijuana has not been legalized at a national level, he’s even hinted at enforcing federal laws in states where marijuana is currently legal.
Until now, investors have largely ignored Canada’s cannabis opportunity. But that’s about to change.
Very soon, these investors will look north of the border to find their next cannabis cash cow. By then, the next Canadian marijuana bull market will have already begun to heat up. And when it does, it will likely be bigger than the U.S. run was.If the U.S. federal government decides to roll back state marijuana laws, U.S. marijuana market growth will undoubtedly slow. The $50 billion in sales that some have projected won’t be met. Worse, the market may even shrink.
But since Canada is legalizing cannabis at a national level, Canadian marijuana companies don’t face the same risks as their American peers. And the Canadian market is still a massive one.
A new study suggests that legalized recreational marijuana could create a $22.6 billion industry in Canada. Marijuana sales could top those of beer, wine and spirits combined. By 2021, there could be more than 3.8 million recreational marijuana users in the country.
That’s more than three times the $6.7 billion dollars of marijuana sales recorded in the U.S. during 2016.
That same study calculated that the Canadian retail marijuana market alone could be worth as much as $8.7 billion a year. And the ancillary market, including growers, fertilizers, testing labs, security and infused products, would generate annual sales of nearly $14 billion.
Add in marijuana-fueled tourism and these estimates could prove to be too lowLegalized marijuana is coming to Canada. And Canada’s cannabis business is primed to become the largest in North America.
Largely ignored by investors, Canada’s cannabis market is about to come under the spotlight. The April 10th introduction of the bill to legalize recreational marijuana was the start. As the legislation moves closer and closer to becoming law, interest in Canada’s new industry will reach new highs. And early investors will have the chance to pocket big gains.
2017 is shaping up to be a historic year for Canada’s cannabis companies. Multiple catalysts including approval of the new law and cultivation licenses issuances will drive investor interest in the sector.