Canada’s cannabis market is estimated to grow about 65 percent – or by about 3 million consumers – following the legalization of edibles and “alternative” cannabis products, according to a survey by Lift & Co. and Ernst and Young outlined by the Calgary Herald. The survey suggests there are currently about 4.6 million cannabis users in the nation.
Jon Kamin, Lift & Co. chief revenue officer, said the addition of the new products will be “transformative” for the industry and would add “a significant cohort of consumers who were not consuming due to stigmatization or the consumption delivery.”
Kamin added that since its easier to develop premium brands with edibles and distillates the profit margins for those products are higher than flower. The survey found that current users are most interested in cannabis-infused food additives, confections, and baked goods.
According to a Deloitte study from June, the alternative cannabis market in Canada could be worth $2.7 billion annually, with edibles representing $1.6 billion of that market. In July, Quebec officials announced a ban on sweetened edibles along with a temporary ban on topicals.
“The race to win legalization 2.0 is on,” he told the Herald.
The survey also found that, unsurprisingly, many consumers are still purchasing cannabis in the illicit market as the cost of legal cannabis remains higher than its illegal counterpart and consumers find the products found in retail stores to be of lower quality.
“The ability of the legal market to match illicit prices will be a challenge that may never be achieved. If prices are higher, the value add of quality must match such premiums.” – Lift & Co/Ernst and Young, cannabis legalization report, via the Calgary Herald
In August, Statistics Canada found that 42 percent of cannabis consuming adults still purchased cannabis illegally.
Edibles are expected to be legalized in Canada Oct. 17 but products are not expected to hit shelves until December.
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