When Canada legalized cannabis in October, estimates on the revenue of the industry skyrocketed.
The edible market, in particular, is expected to hit $ 4.1 billion in both Canada and the U.S. by 2022, as reported by ArcView Market Research.
But it appears as though the Canadian province of Alberta is struggling to get enough product, forcing the province to stop granting new retail licenses.
"While some licensed producers have fulfilled their commitments, not all have," said Alain Maisonneuve, president of Alberta Gaming, Liquor and Cannabis in a statement. "We continue to work with them to fill stock. Unfortunately, regardless of our efforts, we are seeing the supply of most products run out."
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The cannabis shortage has led National Access Cannabis Corp. (NAC,) a private marijuana retailer, to dedicate five team members to watch out for when new product from Alberta’s provincial regulator is available.
But they better act quick, or the supply could already be gone. This is because this private company isn't the only one doing this, meaning there's a virtual race happening to get cannabis products.
“At 3:30 in the morning all of a sudden $4,000 worth of inventory is made available yet in seven minutes it’s drawn down, meaning that other big competitors are doing the same thing,” said Mark Goliger, CEO of NAC.
NAC, which operates 17 stores currently, may not be able to meet its goal of opening 50 stores by the end of the year due to the lack of product and retail licenses being granted.
Alberta is one of the provinces to opt to have private retailers sell cannabis versus having government-controlled stores.
But provinces with the government-controlled stores are also struggling to meet the demand for cannabis. Stores in Quebec, for example, have been restricted to opening for just four days a week.
This will evidently slow down the cannabis boom in Canada, but it seems to be a temporary problem. But once the distributors can catch up with the demand, Canada may have regulatory challenges like Washington state in the U.S.
The Washington State Liquor and Cannabis Board announced in October that cannabis-infused products that could be accidentally ingested by children like candies and lollipops will no longer be allowed to be sold.
Cities without legal cannabis are still jumping on the hemp bandwagon. The legal cannabis compound CBD, which is known to have multiple healing benefits, is already being added to beverages and foods at restaurants across the country.
Learn more about the cannabis industry boom and its impact on the foodservice industry in the episode of The Barron Report below.