Join today and have your say! It’s FREE!
We will not release or resell your information to third parties without your permission.
Please Try Again
{{ error }}

Join today with :


By providing my email, I consent to receiving investment related electronic messages from Stockhouse.
Sign in with existing account
Please Try Again
{{ error }}

Sign In With :


Password Hint : {{passwordHint}}
Forgot Password?
Please Try Again {{ error }}

Send my password

An email was sent with password retrieval instructions. Please go to the link in the email message to retrieve your password.

Where Will "Cannabis 2.0" Succeed?

Omri Wallach Omri Wallach, Stockhouse
0 Comments| September 12, 2019

Almost a year ago, Canada became the first G7 country to legalize recreational cannabis. In a short few weeks, it will take the legalization a step further with the next wave of “Cannabis 2.0” products becoming legalized on Oct. 17.

But each province handled the rollout of legalized cannabis in their own way, and to extremely varied results. Some are raring to go for the next wave of products, while others are still trying to get off the ground.

In anticipation of “Cannabis 2.0,” it’s good to catch up and see how the provinces have been performing, and which are slated to make the biggest splash in the new market.

Atlantic Canada tops per person consumption

For the most impressive cannabis markets, look no further than the Maritimes. While they lag in share in population, the Atlantic Provinces more than made up the difference with some of the highest per-capita rates of legal cannabis sales. Nova Scotia was especially impressive, beating out all of the Western Provinces in total sales at $47.9 million through June 2019 according to Statistics Canada.

In terms of bang for buck, PEI was second only to Yukon with monthly average spending of $7.81 per capita. The advantage was clear earlier in the year, as the Maritimes had significantly higher percentages of total Canadian cannabis sales compared to their shares of the population in April.

As the cannabis product market is set to expand, local governments are eager to continue their impressive performances. Nova Scotia’s successful provincial retail stores (a rarity in Canada) will directly handle new product sales, and Newfoundland is working to grow its retail and cultivation footprint even further.

Alberta sprints ahead while BC stumbles

When Alberta was setting up its plans for the cannabis market, it took a lot of cues from the private liquor retail market that operates in the province. A year later, the strategy looks like it paid off. Alberta had the highest total sales of legal cannabis compared to all other provinces through June 2019, and more than 275 retail stores open across the province.

In contrast to the slow retail rollout of other provinces, Alberta Gaming, Liquor and Cannabis employed a heavy and steady stream of new locations being approved. Growing quickly led to some growing pains, especially as a temporary shortage of cannabis forces the regulator to freeze permitting and temporarily resort to lottery for supplying operators, but the Province quickly recovered.

On the flip side, to say that British Columbia’s cannabis market has under-delivered is a massive understatement. The Stats Canada report showed that the so-called capital of cannabis in Canada had the second lowest sales of legal cannabis through June 2019 at only $19.5 million.

That isn’t to say that cannabis isn’t selling in the province, but the majority of sales are on the illicit market. Operators and government officials point the blame at everything from the slow rollout of retail stores to supply shortages.

But it seems the tide is turning on the West Coast. There are now 73 licensed stores in the province, with 13 in Vancouver and 5 in Victoria, according to the Vancouver Sun. The upcoming introduction of edibles, concentrates, and additional cannabis products are also expected to draw in regular illicit users.
Slow start with high potential in Ontario and Quebec

At the start of the legalized cannabis race, the Ontario cannabis market didn’t even make it out of the gate. The first store didn’t open until April while the government reorganized its strategy, but the market is finally expanding.

Last month a lottery was held by the province’s regulatory body, the Alcohol and Gaming Commission of Ontario, to expand the retail market. 42 licenses in total won the lottery from thousands of applications, which more than doubles the current total number of legal cannabis stores in Ontario to 75.

But considering the slow rollout of retail stores, the potential of Ontario is hard to deny. Despite the late start, The Stats Canada report showed Ontario sold $121.6 million of legal cannabis through June 2019, second only to Alberta.

In neighbouring Quebec, however, the market might be hitting a crossroads. The province placed just behind Ontario with $119 million in total legal sales, but further growth might be stymied as only province-run stores are allowed to operate. In their first fiscal year of operation, the stores posted a $4.9 million operating loss.

A lack of stores is just one of the reasons that the percentage of sales in Quebec was significantly behind the percentage of population. That leaves it room to grow, but government agencies are increasingly coming to odds with the market. Recently, health regulators in the province proposed strict rules for the incoming wave of legalized products that remove a lot of edibles and concentrates from the market.
For more info on the cannabis sector, including tips on how to invest, the Cannabis Stocks hub on Stockhouse has you covered.

Interested in these industries and sectors?

Receive investor kits and email updates from Stockhouse and directly from these companies.

Metals & Mining

Interested in these industries and sectors?

You are already a member! Please enter your password to sign in.


No comments yet. Be first to comment!

Leave a Comment

You must be logged in to access this feature.


Get our FREE StockTalk Investor Guides by sector as they are released!

Stay on top of sector specific news, get industry leaders insights and our best content, delivered to your email.

You are already a member! Please enter your password to sign in.