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Why is Canada running out of marijuana?
Cannabis retailers in Canada began to run low on supplies from the very first day of legalisation a month ago. How long are shortages expected to continue as the new market for recreational cannabis finds its feet?
In the early days of legalisation, James Burns was confident his company had enough product on the shelves of its five new cannabis retail stores, even though they only received half of their order from the provincial supplier. Now, he has had staff refreshing the government supply website in the early hours to snap up scarce new stock as soon as it's available, and is considering restricting store hours.
"While there was product to order we were very comfortably getting a large amount of it," says Burns, the CEO of Alcanna, a company that owns a chain of private liquor stores in Canada and the US and, now, cannabis stores in the province of Alberta. "But obviously, when there's literally none there, it doesn't matter how big you are, there's just none there. If the government warehouse is empty, it's empty. There's nothing you can do."
[...] A report released in early October by the CD Howe Institute, a Toronto-based economic think tank, estimates that the current legal supply will meet about 30% to 60% of total demand in the first months of legalisation. But people in the industry say the scarcity is worse than expected. "Everybody knew this was going to happen," says Burns. "Probably, frankly, not this quick and this starkly."
Patrick Wallace, owner of Waldo 420 in Medicine Hat, Alberta, predicts it will be a year to 18 months before supply matches demand. "We're riding on our initial investment of stock from a few weeks back," he says. "So we're OK now but it's not sustainable."
Previously: Canada Becomes the Second Nation to Legalize Cannabis
Peter Thiel's Cannabis Company Was Briefly Worth More Than Twitter
Hostage to NAFTA? Canada Signs on to War on Drugs Despite Recent Cannabis Legalization
Cannabis Becomes Legal in Canada
(Score: 2) by looorg on Friday November 16 2018, @01:50PM (8 children)
Does seem a bit odd, I thought these things grew like weed(s) ...
OK but still isn't the growth cycle from seed to finished product about three months. So it's not like this couldn't be fixed quite rapidly if one only wanted to. There is the issue of scaling up and going industrial but if there is a constant shortage and high demand it should be a worthwhile investment, and it's not like people are going to stop smoking weed anytime soon so the risk should be fairly low. So 12-18 months to go industrial seems about right, it's not like they could have started growing while it was still not legal so naturally there will be some kind of slump in the start.
(Score: 3, Insightful) by takyon on Friday November 16 2018, @01:59PM (4 children)
Seems to be an issue with the regulatory structure. They want tight control over the supply.
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(Score: 0) by Anonymous Coward on Friday November 16 2018, @02:43PM (1 child)
But the invisible hand of the market is supposed to fix that, no?
(Score: 3, Insightful) by takyon on Friday November 16 2018, @02:48PM
Yes, street dealers in Canada get to keep hustling for at least a few more months.
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(Score: 2) by bob_super on Friday November 16 2018, @05:51PM
> Seems to be an issue with the regulatory structure. They want tight control over the supply.
Or they underestimated demand, or the suppliers underdelivered against the forecast.
With the guys next door considering it illegal, it's not surprising that the first steps of commercialization of the products would be on the careful side rather than the oversupply side.
(Score: 2) by dry on Sunday November 18 2018, @05:54AM
It's hard to ramp up supply while it is illegal. Most of the regulating has been in the hands of the Provinces as well, the Feds are in charge of criminal law in Canada, so they can legalize it and put minimums like 18 yrs old but really it is the Provinces that run stuff like this and most of them acted like legalization would never happen until about a year ago and then rush and rush with some Provincial elections bringing in new governments that changed the regulations. This way we have all kinds of experiments, from Alberta going totally private with a minimum age of 18 to Quebec (IIRC) going totally government operated and the new government raising the legal age to 21. Some Provinces also give the municipalities a lot of power in deciding on retail and growers. The Territories, while not sovereign and under Federal jurisdiction, are mostly treated the same as a Province, so there's 13 experiments happening.
(Score: 3, Funny) by Webweasel on Friday November 16 2018, @04:26PM (2 children)
More like 4 months. 3 Months to grow yes, but at least 2 weeks to dry properly and then it should be cured for a few months afterwards.
Errr, not that I'd know anything about the topic. Cough.
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(Score: 0) by Anonymous Coward on Friday November 16 2018, @06:33PM (1 child)
you have varieties that take a month from a clone to flower harvest other that takes up to 6 months
(Score: 0) by Anonymous Coward on Saturday November 17 2018, @12:56PM
It's not as dependent on variety as growing conditions. Temperature, light, and nutrient delivery all have far bigger impact than strain.