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No End in Sight for Cannabis Shortage

Stockhouse Editorial
0 Comments| November 16, 2018


The irony of it. Now that cannabis is legal for adult-use in Canada, it is much harder to find, especially quality product.
 
Recent headlines have warned that this drought among Canadian producers could last years, as they struggle to make delivery commitments. Many blame strict Health Canada regulations on the country’s 132 licensed producers (LPs), how long it took the agency to approve licenses and the time required by companies to develop a quality and compliant product.
 
Private retailers are now clamouring to get more cannabis growers fully-licensed, along with cultivation space to meet the enormous demand for legal cannabis. Allan Rewak, executive director of the Cannabis Council of Canada, who speaks for 85% of the country’s legal cultivation space told the Edmonton Journal this past week that once Health Canada approves more LPs, the supply will normalize, but likely not until early 2019.

Click to enlarge
 
In Alberta for example, the Gaming Liquor and Cannabis (AGLC) provincial commission that distribute to private shops said 72 of its 90 cannabis varieties of were out of stock. Meanwhile, the number of total varieties had fallen by 100 from the previous day.
 
Since becoming legal on October 17th, the AGLC’s 15 LPs have been scrambling to meet demand, reaching out to LPs across the country, but have been told that the same problem exists from the Pacific to the Atlantic.
 
Th solution? It seems like it may be as simple as time.
 
Cannabis giant Canopy Growth Inc. (TSX:WEED) CEO Bruce Linton said in an interview that the  Smiths Falls, Ontario company is working “flat-out” to meet demand, supplying roughly 300,000 product units over the course of the month of November.
 
He predicts a series of surges in supply, met with shortage after shortage. While more cannabis product will end up on shelves by the end of the year, new retailers will keep opening their doors as they attain federal approval, meaning that the supply could go much longer than a few months before it manages to finally catch up with demand once and for all.
 
In the meantime, Canopy is just one company working to increase its production. It plans to beef up its growing space from four to six million square feet over the course of the next year, with a 90,000 square-foot production warehouse facility coming online in Edmonton.

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