On 17th October 2019, Canada made a landmark decision in the legalization of cannabis edibles. This comes a year after the legalization of adult recreational marijuana use in Canada. Cannabis 2.0 legalization had to wait for the formulation of regulations that govern the manufacture and use of edibles, vapes, beverages and concentrates.
Most cannabis companies have not been performing as well as expected since legalization, but after Prime Minister Justin Trudeau gave cannabis edibles a nod, we are likely to see a shift of fortunes. The USA and Canada are world pacesetters in modern marijuana legalization, however, some people are raising concerns about the enforcement of cannabis laws and the protection of the citizens.
Canadians might not yet see marijuana edibles until the last two weeks of the year as licensed producers are required to give a 2-month notice to Health Canada before marketing any cannabis derivatives.
As the cannabis market gains momentum and new entrants, these are some companies you can expect to make strides in the edibles industry.
Vapes and Edibles from Aurora
With an estimated value of $1.6 billion, the cannabis edibles market in Canada is quite lucrative. A lot of people have shown interest in edibles over other forms of marijuana consumption like smoking. The recent warnings in the United States against vaping due to lung illnesses has affected the vapes market substantially.
Aurora Cannabis has announced interest in both edibles and vape markets. According to Deloitte, gummies are the preferred form of marijuana edibles. Chocolates and brownies have also received considerable interest from Canadians. Aurora is planning to carry out its production in its plants: Aurora Polaris and Aurora Air. The two facilities will focus on the manufacture of gummies and chocolates.
The company is also wooing partners to broaden its scope. Its partnership with PAX Labs focuses on the improvement of its vapes. Another partnership with UFC in the USA is also geared towards the marketing of the companies products. The plans are underway to distribute the products on December 17th when the stocking of edibles will take effect. The company has also undertaken educational campaigns to educate the public and better understand market demand.
In 2019, HEXO stocks have seen a significant decline after hitting an all-time high in April this year. However, the legalization of cannabis edibles may revive the company’s fortunes. The company is positioning itself in the beverage industry, and announced a partnership with Molson Coors to introduce CBD-infused beverages through a new joint venture dubbed Truss.
As part of its strategy, HEXO will continue with its production of gummies and vapes. As one of the giants in the Canadian cannabis industry, HEXO is not taking chances in tapping the expanded market. According to Sebastian St-Louis (Yahoo News), one of the co-founders in HEXO, technology plays an essential role in creating a brand and differentiation. The company is also investing in research and development to come up with new products to introduce into the market.
According to the CEO of the joint venture, Brett Vye, Truss will launch 6 CBD-based beverages. This is seen as a move to counter a primary competitor in the beverage industry, Fluent Beverages, who announced that their CBD beverage will also be launched in December.
Canopy Growth Chocolates
Canopy Growth (previously Tweed) is taking over the Hershey chocolate plant in Smith Falls. The company is also planning to sell its cannabis-based chocolate by mid-December. The CEO of Canopy Growth, Mark Zekulin, said they hope to overcome the stigma which has taken root due to the experience of black market edibles. The company boasts one of the world’s largest market shares in the cannabis industry.
Canopy Growth formed a partnership with Constellation brands to make a CBD-infused drink. The current regulations prohibit the production of cannabis-alcohol combo. The company also dedicated a section of its facility in Ontario to the production of at least 80,000 cannabis chocolates. Earlier this year, the company CEO had urged the government to hasten the move to legalize edibles to fight the black market.
Canopy will also be offering THC only beverages and THC + CBD beverages once the new products for the second wave of legalization are on the market.
Aphria Vapes and Concentrates
Aphria has big plans for cannabis 2.0 legalization. The company has struck a partnership with PAX Labs to help with research on vapes and concentrates. According to the company, vapes and concentrates will make up at least 30% of the cannabis market in Canada. Aphria is also in the process of manufacturing PAX pods for use by patients as well as adults for recreational purposes.
Apart from the local market, Aphria is planning to penetrate the US market. However, recreational cannabis is still illegal at the federal level. The company plans to focus on the medical application of marijuana, despite the FDA’s strict regulations for the market.
The company hopes to benefit from the gap between demand and supply of cannabis vapes and concentrates. They also expect their revenues and profits to grow as well. The company is also investing in current technology to facilitate production and meet market demand.
Cronos has partnered with various industry stakeholders to catapult its production of cannabis edibles in Canada. MediPharm is one of the partners with Cronos. The pharmaceutical company will focus on making cannabis concentrate-filled vaporizers for the Cronos brand, COVE.
The company plans to buy 4 subsidiaries from Redwood Holding Group to expand its base. The company also launched a research project that is aimed at developing next generation vapes to cater to the rising demand. The company’s ties with several US firms can make the burden of leveraging in the cannabis edibles market easier.
Cannabis legalization 2.0 in Canada has opened numerous opportunities for edible manufacturers. As each company moves towards commanding a share of the vast market in mid-December, we can only wait and see. Other companies that will be tapping the edibles market are Weed, Tilray, Mondelez, among others. We will see more partnerships between cannabis companies and major brands in an attempt to woo more consumers.