For now Canada’s pot supply can’t meet the market demand — however, there’s a silver lining to this particular cloud
First: legalization. Next: a booming, ever-burgeoning pot industry.
That was the plan. And at first it seemed to be working. Canada legalized recreational marijuana in October 2018. Demand soared.
Just one problem. As industry experts are now warning, the supply just isn’t there to meet the demand. And the shortage of pot in Canada could last for a while, according to a Bloomberg News report. Cowen & Co. analyst Vivien Azer tells Bloomberg that in five provinces, 50% of products for sale have gone out of stock.
Meanwhile, Quebec-controlled pot retail outlets are now only open four days a week. Alberta has halted giving out retail licences. Ontario has announced it will merely open 25 stores.
Chuck Rifici, chief executive officer of the Toronto-based Auxly Cannabis Group Inc., explains, “There’s a lot of execution risk; people are expanding by 10, 20 times. Personally, I think we’re at least three years out from hitting real equilibrium.”
If the delay makes you impatient, you’re not alone. As reported in the Toronto Sun, Ontario Minister of Finance Vic Fedeli says that if his government had its way, “there would be as many cannabis retail stores across the province as the market could sustain.”
Fedeli goes on, “We believe in a free market, promoting innovative entrepreneurs, and creating a province that is open for business. This is the best approach to eliminating the illegal market and keeping our children and youth safe… Unfortunately, there is a serious cannabis supply shortage created by the federal government. As a result, we are being forced to scale back our plans dramatically, for now.”
Still, as Business In Vancouver notes, British Columbia entrepreneurs remain enthusiastic about getting retail licences despite the current shortage. And the BC Cannabis Stores’ website now features a special section to alert consumers when out-of-stock products are available again.
Now for the silver lining: Just Kush is in the final stage of obtaining regulatory approval for licensing
We promised you the silver lining, and here it is. Liberty Leaf’s state-of-the-art Just Kush cultivation-production facility is awaiting regulatory approval, which will give it the go-ahead to produce. We expect all to go well in this final stage and look forward to reaping the benefits of the intense market demand.
You may recall that, this past fall, Liberty Leaf announced the completion of work on Phase I of cultivation production at Just Kush. This was a significant step toward our Okanagan facility’s obtaining its cultivation licence.
Liberty Leaf President and CEO Will Rascan declared, “I am very excited with the final result of the completed buildout. Coupled with our innovative technologies, what this means is that Just Kush can now officially notify Health Canada that it’s ready for cannabis licensing.” Which it has done with submission of its Affirmation of Readiness video this past November. Recent notification by Health Canada that our Cannabis License application is now in the detailed review stage has us anticipating receipt of our license very soon. At this point in time it is in Health Canada’s hands.
As Rascan also explained, Just Kush has all the potential of being a market leader in quality of product. The innovative facility boasts: an advanced security system; comprehensive inventory management (i.e. seed-to-sale) and reporting software; new LED lighting; state-of-the art aeroponic growing system; and the detail and care in design of individual grow rooms.
So, while the market overall suffers short-term lack of supply, we’re excited about Just Kush’s potential for a future as bright and sunny as its Okanagan setting. Or, to put it differently, bring on the demand!
Whether you are an investor seeking to include the cannabis industry in your portfolio, or an entrepreneur with a start-up or a strong business idea for the legal cannabis space, Liberty Leaf has the expertise and financial resources to build your portfolio or take your enterprise to the next level.