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(Bloomberg) – Loaded buyers in Halifax, giant joints at a "Wake & n Bake" in Toronto and 100 online orders in one minute in Manitoba, Canada becoming the first country in the Group of Seven to legalize marijuana for recreational purposes, giving it a considerable lead in the global $ 150 billion marijuana market.
Stores in St. John's, Newfoundland, were the first to sell cannabis for recreational purposes, followed by more than 100 outlets and websites open to 37 million people across the country. This is a historic moment for an industry that has quickly moved from the fringe to the suburbs.
"I am very happy, this is a historic day for Canadians and the world, because we are really setting a precedent here," said Isaac Langille in front of a store in Halifax, where he bought the legal limit of 30 grams, in Spending $ 344 ($ 264) on the products of Aphria Inc. and Organigram Holdings Inc.
Canada is the second country in the world to legalize the recreational pot nationwide after Uruguay. As a result, according to Arcview Market Research and BDS Analytics, it has become the leader of the global cannabis industry, which is expected to reach $ 32 billion in consumer spending by 2022 alone. Meanwhile, the global market as a whole could reach $ 150 billion, according to estimates by Roth Capital Partners.
Stocks Downer
"The eyes of the world are on Canada and Canadians should be very proud because people have been fighting for decades to make this moment a reality," said Brendan Kennedy, president and CEO of Tilray Inc. the largest cannabis company on the market.
After spectacular gains in the run-up to legalization, cannabis stocks did not join the party on Wednesday. Aurora Cannabis Inc. lost up to 15% at 10:17 am in Toronto, the largest drop since February, before reducing its losses. Canopy Growth Corp. was down 3.4% at 1:15 pm and Tilray Inc., the world's largest pot company in terms of market value, dropped by 6%.
Marijuana for medical purposes has been legal in Canada since 2001, but it is only about four years since the first cannabis companies started to be listed on Canadian stock exchanges. During this short period, approximately 140 pot manufacturing companies were listed in Canada with a combined market value of more than C $ 60 billion ($ 48 billion).
First sale
Alicia Wright, 38, was the first customer to buy pot at the NSLC cannabis store in Halifax, Nova Scotia, to pay about $ 45 Canadian for 3.5 grams of pot and a mill. At the opening of the store at 10:00 am local time, the composition of the group was about 130 people. The atmosphere was festive when a store manager had announced to everyone that one had to have an identity card.
"I was happy to see sprays here because I know that burning is perhaps not the best choice for many people, so there are different ways to consume," Wright said. She hopes to see more variety in the future. "I took advantage of the oil, so I hoped it would be an option today. That's not the case but I know it's coming. "
Beverley Ware, a spokesperson for the Nova Scotia Liquor Corporation, who oversees cannabis sales in the province, said the stores had only about 40 percent of the anticipated stocks. About 106 products had been purchased and the government was expecting 282 for the opening day.
On Toronto's Queen Street West, the party started early, while the Friendly Stranger Cannabis Grocery Shop organized a "Wake 'n Bake" with burritos and coffee, a campfire and what they nicknamed Canada's first community token.
Accomplished job
"We fulfilled our mandate," said Robin Ellins, co-founder of the store. "Friendly Stranger was created to convey and raise public awareness of cannabis issues in order to legalize them."
Alex Gore, 28, a glassblower wrapped a huge seal at the start of the meeting. "I touched the bang before leaving and got on the train this morning," he said. "I have been preparing for 16 years."
In small towns like Smiths Falls, Ontario, where Canopy Growth Corp. is located, leaders and employees had to celebrate together.
In Quebec, the Quebec Cannabis Society plans to offer about 110 products in dozens of stores ready for Day 1. The number of locations could increase to 150 by the end of the next three years, says the company. .
Black market
The stores sell jars for only C $ 5.29 per gram, said Alain Brunet, general manager of Liquor Board, which oversees the industry.
"We are adapting to the market, we do not want prices to be a barrier to entry, especially at the beginning," Brunet said in an interview with Montreal's 98.5 FM radio station. "You can evaluate the prices on the black market in Canada and it is in Quebec that the prices are the lowest. We had to adapt to the prices on the black market in Quebec. "
In Manitoba, security guards drove the parking lot at the Delta 9 store south of Winnipeg, where some enthusiastic customers had been lined up since Tuesday night. The company's online sales began at midnight and some products are already sold out, spokesman Gary Symons said. The initial demand was so strong that the online portal recorded 100 sales in one minute and 500 in one hour, for a total of $ 50,000 CDN.
"It's huge," said Symons, standing near a showcase presenting samples of different cannabis strains. "It will be a bang show."
Medical use
Steven Stairs, 34, was the first to queue in front of the store on Tuesday night at 6 pm For the medical user, who is legally blind and has been using cannabis for a decade to treat glaucoma and cataracts, the first day of legal sale marks a change for Canada and society.
"I am extremely happy," said Stairs, who slept outside in freezing temperatures, including a tent, a sleeping bag and marijuana. "I am very grateful that it happened in my generation."
As cannabis remains illegal in the United States at the federal level, Canada's investment banks carry out most of the industry's transactions and its stock exchanges list most of the industry's shares. This was a boon for the country as cannabis stocks soared, making comparisons with cryptocurrency and the dotcom bubble. Since Canopy Growth announced a $ 3.8 billion investment by alcohol giant Constellation Brands Inc. in mid-August, investors have gathered in the sector, boosting the Horizons Marijuana Sciences ETF from 70% life.
Challenges of supply
Nevertheless, the deployment of legal cannabis sales should not be totally harmonious. Aphria Inc. CEO Vic Neufeld said he foresaw supply shortages in the early stages of adult use, while licensed producers struggle to meet demand . On October 17, only a small number of retail outlets were operational, including one store in British Columbia and none in Ontario, Canada's most populous province, where only online sales will be allowed. And the black market is expected to remain in business, as the supply of legal pots will only cover 30 to 60 percent of demand after legalization, according to a study by researchers at the University of Waterloo and the University of Waterloo. CD Howe Institute.
"For the first day, I think everything will be fine," said Marcie Kiziak, general manager of Alcanna's cannabis division at the Nova Cannabis store in Edmonton, Alberta. "After that, nobody really knows it."
– With the help of Sandrine Rastello, Frederic Tomesco, Dave Merrill, Erik Hertzberg and Kevin Orland.
To contact the reporters on this story: Kristine Owram in Toronto at [email protected], Doug Alexander in Toronto at [email protected], Jen Skerritt in Winnipeg at [email protected]
To contact the editors responsible for this story: David Scanlan at [email protected], Jacqueline Thorpe
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