October 17 marked the one-year commemoration of recreational marijuana legalization in Canada. After the legalization of marijuana in 2018, Canadian regulators were fast in developing regulations for marijuana leaf and oil products. However, it took them longer to establish rules for cannabis products such as edibles, cannabis-infused drinks, and concentrates used in vape pens. Implementation of the new regulations led to the opening of a new market, referred to as Cannabis 2.0. Below are the three things that could characterize the Cannabis 2.0 market on the day of their legalization.
- No New Product in the Market
Despite the hype surrounding the launch of the cannabis 2.0 market, the event will not be exciting as it was during the launch of the first marijuana market in Canada because no new cannabis derivative product will be introduced in the market.
Licensed marijuana producers are required by law to issue a 60-day notice to Health Canada before selling marijuana products even though the new regulations for cannabis derivatives are already in effect. The consumers will therefore not be able to get their hands on cannabis derivatives until mid-December.
Since the launch of the cannabis 2.0 market comes before the holiday, it will be a while before it can be determined how the market performs and how the holidays affected sales. Reports for the cannabis 2.0 sales for the first quarter of sales will come in February 2020.
- Uncertainty Surrounding Cannabis-Infused Beverages And Vaping Products
Analysts and investors will be anxiously waiting for the sales data from the first quarter, which will be more focused on the sale of cannabis-infused beverages and vaping products.
There is much uncertainty surrounding cannabis-infused beverages, and this has forced some companies such as Aurora Cannabis to opt-out of developing cannabis-infused drinks due to the expected low market share of the products, said Cam Battley, the CEO of Aurora Cannabis in the company’s fiscal 2019 Q3 conference in May.
Canopy Growth, in collaboration with Constellation Brands, has developed several types of beverages meant to go up on the shelves later in the year.
Both Aurora and Canopy plan on launching vaping products in the markets, but with the recent scare of vaping-related illness, they are uncertain of how the product will perform and if it will be banned.
- Cannabis Edibles Will Attract Huge Sales
Due to the skepticism surrounding vaping products and cannabis-infused beverages, cannabis edibles seem like the safest option to introduce during the launch of cannabis 2.0. Thus, most cannabis producers are planning on producing a variety of cannabis edibles.
For example, Aurora Cannabis plans on producing cannabis chocolate, gummies, and mints. According to Bruce Linton, Canopy Growth plans on creating every type of cannabis edible you can come up with. However, when the former CEO of Canopy, Bruce Linton, made these remarks, the new cannabis regulation had not been finalized by Health Canada.
It is thought that marijuana industry players like Lexaria Bioscience Corp. (CSE: LXX) (OTCQX: LXRP) and IONIC Brands Inc. (CSE: IONC) (OTC: IONKF) would wish to for large market like the U.S. to have a uniform law regulating cannabis in all its forms as is the case in Canada, but that still seems to be far off.
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