login register unsubscribe from alerts forgot password? spacer
Water Today Title October 25, 2021

HOMEspacer | ABOUT spacer | MAPS spacer | ADVISORY INFO spacer | A TO Z spacer | WTECH spacer | FREE WATER ALERTS spacer SIGN-UPspacer |LOGIN

Top Stories

Update 2019/1/29

This story is brought to you in part by
Ad - Hatch


By Cori Marshall

October 17, 2018, the coming into force of the federal Cannabis Act ushered in a new normal in how Canadians can procure and consume cannabis. Medical users have had some form of legal access since 1999, and federal legal framework has been in place, in some form, since 2001.

Legal recreational use has changed the marketplace for both how Canadian obtain and consume cannabis. WaterToday set out to find out, how this new environment has affected Canadians' buying and consumption habits, supply and demand, and licensing.

André Gagnon, Communications Advisor for Health Canada (HC) and the Public Health Agency of Canada, said that "HC is aware of reports of localized shortages of cannabis products in some markets and for some product lines." Gagnon assured that this does not indicate a national cannabis shortage.

Gagnon explained, "data reported by federal licence holders and provincial and territorial public bodies via the national Cannabis Tracking System (CTS) indicate that total inventories of cannabis far exceed total sales."

At the same time as the Cannabis Act came into effect, the federal government launched the CTS. According to the web page, the national tracking platform is "meant to track only what is needed to monitor the flow of cannabis at a national level to meet requirements under the Cannabis Act."

    "Establishing a highly integrated regulated market for cannabis - the first of its kind in the world - is a historic and transformative endeavour."

    André Gagnon, Communications Advisor, Health Canada and the Public Health Agency of Canada.

Supply issues appear to be explained by the novelty of the legal recreational cannabis market, essentially growing pains. Gagnon said, "as with all major transactions, a period of adjustment is normal and was anticipated by all governments and the industry." He underlined that the "period of transition will likely continue in months ahead," as the market finds its stability.

"As the market stabilizes, the supply chain difficulties currently being experienced by provincial and territorial retailers and distributors will dissipate, and that localized product-specific shortages will become far fewer in number," Gagnon said.

One of the objectives of the CTS is to track product that is being transferred to the illegal market. Provincial and territorial bodies, private retailers and licenced producers must provide monthly reports.

According to the Preliminary Report, Canadians purchased a total of 8,872 kg of dried cannabis in November an increase of 22% from October. Sales of cannabis oil increased by 14% in the first full month of operations under the new legal framework.

There were indeed product surpluses, the amount of unsold oil at the end of November increased by 211%, which represented a four-month supply. These numbers represent totals for all of Canada, so we reached out to some provincial retailers for a more local portrait.

In British Columbia, the Liquor Distribution Branch (LBD) has charged with overseeing the sale of cannabis in the province. The BC Cannabis Store operates an online sales platform and one physical store in Kamloops.

Kate Biley, Senior Communications Officer, Corporate Communications & Stakeholder Relations for BC Liquor Distribution Branch, informed WaterToday that the "LBD is unable to provide sales data related to its BC Cannabis Stores, as this represents competitive business information."

"We can tell you," Bilney said, "BC Cannabis Stores has recorded a total of 114,470 transactions across its two sales channels." With only one store, 39% of recorded sales were at the Kamloops location.

BC Cannabis Stores experience supply issues early on. Bilney said the volume and assortment that the LBD received "was considerably lower than what Licenced Producers (LPs) committed to providing." There was a range of circumstances that contributed to the situation from insufficient packing supplies, LPs still waiting on their sales licence, to lower crop yields.

Even with the early complications, the LBD is receiving supply and "is working closely with LPs to procure additional product to further expand its product assortment and cater to customer demand."

Amanda Winton, Communications Manager, Corporate Communications for the Ontario Cannabis Store (OCS), said that "OCS.ca is performing well and OCS has delivered more than 400,000 orders across Ontario."

Winton said that "current in-stock levels of product are constantly changing given that new deliveries are received regularly, and existing stock is being sold."

The vision of how the cannabis market in Ontario would operate changed with the changing government. OCS is Ontario's "exclusive online retailer," and remain as such. Winton informed WaterToday that "the OCS will act as the exclusive wholesaler of cannabis to a network of authorized retail stores, beginning April 1, 2019."

The new legal cannabis market has created a dynamic environment in the early going for retailers, but how have these changes affected cannabis production? We were able to exchange with Krina Lahnakoski, Vice President, Quality and Regulatory for Cannabis Compliance Inc. (CCI), whose mission is to aid in obtaining Health Canada approval for LPs.

Lahnakoski said that "one of the main changes since October 17 was the introduction of the new requirements under the Cannabis Act and the use CTLS tracking system," adding, "both were a sharp learning curve for our consultants, but we have now processed almost all of our clients into the new system successfully."

"Out of necessity, there have been changes in the way Health Canada is prioritizing their resources," Lahnakoski said. This was not only for those applying for licences, Lahnakoski underlined that CCI is "fully supporting this by prioritizing the same way and keeping clients informed."

When asked if CCI is seeing an increase in those seeking licences to cultivate cannabis, Lahnakoski said "absolutely, the new licence classes, especially the micro cultivation licence is really giving the existing cannabis industry and grey market growers an entry into the new legal framework."

    "Micro licencing is in demand right now and as existing LPs step up to partner with micro cultivators we are seeing more and more interest."

    Karina Lahnakoski, Vice President, Quality and Regulatory, Cannabis Compliance Inc.

Lahnakoski is of the opinion that the intent of the micro licence class is "to bring in new genetics and small growers into the legal framework," and that it "will be successful." Lahnakoski explained that "we won't see the rewards from [micro grows] for another 1-2 years as these microsites get security cleared personnel and licenced."

When asked about the future of the cannabis production industry Lahnakoski said "this industry is going international." She added that "we are seeing great interest in Canadian product and expertise, and cross border collaborations are on the rise."

To date, the federal government only legalized the sale and recreational use of dried flower and oils. The next step in this exercise is the legalization of edibles and topicals. On December 20, 2018, public consultations began on draft legislation for edibles and topicals.

Andre Gagnon HC Communications Advisor said, "the proposed regulations for edibles would establish new regulatory controls to address the public health and public safety risks associated with these new classes of cannabis." Gagnon underlined that this includes "their appeal to youth and the risks of accidental consumption, overconsumption, and foodborne illness."

    "The industry must be able to offer the same diversity of products that are available in the illegal market in order to be able to successfully displace the illegal market."

    André Gagnon, Communications Advisor, Health Canada and the Public Health Agency of Canada.

On the retail side of things Kate Bilney, Communications Officer, BC Liquor Distribution Branch said that "once regulations have been set, we will act accordingly."

October of last year changed how Canadians purchase and consume cannabis. The new legal environment offers many new opportunities for potential producers and in some jurisdictions retailers. This is just the beginning, we are not even six months into this experiment, it will be interesting to see how it affects how cannabis is seen, not only in Canada but beyond its borders as well.


Cannabis Report

Related info

bullet A to Z
bullet Advisory Maps

For articles published before 2020, please email or call us

Have a question? Give us a call 613-501-0175

All rights reserved 2021 - WATERTODAY - This material may not be reproduced in whole or in part and may not be distributed,
publicly performed, proxy cached or otherwise used, except with express permission.

HOMEspacer | ABOUT spacer | MAPS spacer | ADVISORY INFO spacer | A TO Z spacer | WTECH spacer | FREE WATER ALERTS spacer SIGN-UPspacer |LOGIN