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
Related Stories
Canada becomes second nation in the world to legalize marijuana
Recreational marijuana use will soon be legal in Canada after the Senate passed a "historic" bill on Tuesday with a vote of 52-29. Canada is only the second country in the world -- and the first G7 nation -- to implement legislation to permit a nationwide marijuana market. In the neighboring US, nine states and the District of Columbia now allow for recreational marijuana use, and 30 allow for medical use.
Bill C-45, otherwise known as the Cannabis Act, stems from a campaign pledge of Prime Minister Justin Trudeau to keep marijuana away from underage users and reduce related crime. The act to legalize the recreational use of weed was first introduced on April 13, 2017, and was later passed at the House of Commons in November. The Senate passage of the bill was the final hurdle in the process.
Uruguay was the first country to legalize marijuana's production, sale and consumption in December 2013.
Also at CBC, BBC, NPR, Reuters, and The Guardian.
From the fine pages of the New York Post, such as they are:
Shares of Peter Thiel-backed marijuana grower Tilray soared as much as 94 percent on Wednesday, briefly hitting a market value of $28 billion, as bullish comments from the company's chief executive stoked Wall Street's growing euphoria over marijuana stocks.
But late in the afternoon, the shares crashed, falling briefly into negative territory before spiking in the final minutes to close the day at $214.06, up 38 percent. Traders blamed the wild ride, marked by at least four halts for volatility, on a short squeeze as pot-addled investors tried to get their heads around the budding business of legalized weed.
Despite the bumpy day, shares of the Canada-based pot farmer — which are up 10-fold from their debut on the Nasdaq in July — closed with a market capitalization of $19.93 billion, bigger than Expedia, Dish Networks and Mylan. Twitter, which briefly got eclipsed by Tilray, closed Wednesday with a market cap of $22.3 billion.
Thiel, the libertarian tech tycoon who backed Donald Trump in 2016, is rolling in the green thanks to Tilray's runup. Pot-focused private equity fund Privateer Holdings, in which Thiel is a big investor, owns 76 percent of Tilray's stock — making the fund's stake worth roughly $15 billion.
Wow, better than a Tesla pump-and-dump, no doubt due to the mimetic transfusion of young non-gay blood!
See also: Investing in cannabis is 'a great hedge' for alcohol and drug companies, CEO of medical marijuana producer Tilray says
Canadian cannabis producer Tilray had a wild day after its CEO appeared on Cramer's 'Mad Money' (TLRY)
It's Time for a Reality Check About Tilray
Weed is the new blockchain
Tilray Is Partying Like It's 1999 (and It Won't End Well)
Pot-focused investment fund backed by Peter Thiel gets a boost from its big stake in Tilray
Canada signs on to U.S.-led renewal of war on drugs
Canada was rebuked on Monday by a group of world leaders and experts on drug policy for endorsing a Trump-led declaration renewing the "war on drugs" and for passing up a critical moment to provide global leadership on drug regulation.
The Trudeau government's decision to sign on to the declaration, released by the White House on the sidelines of U.S. President Donald Trump's first attendance at the United Nations General Assembly in New York, contradicts Ottawa's previous skepticism of Washington's drugs war at home and abroad, and comes just weeks before cannabis legalization in Canada.
Former New Zealand prime minister Helen Clark said she believed that both Canada and Mexico − which also signed the declaration even though president-elect Andres Manuel Lopez Obrador has repeatedly said that the "war on drugs" has failed and he will pursue new policy − likely have signed on reluctantly, held hostage by the North American free-trade agreement talks in Washington, over which a critical deadline looms.
Countries that signed the "Global Call to Action on the World Drug Problem" were promised an invitation for their leader to attend a kick-off event with Mr. Trump in New York. The statement was not drafted in the usual multilateral process of a declaration from the UN and the wording was presented as non-negotiable. One hundred and thirty countries signed but 63 did not; the dissenters include major U.S. allies such as Germany, Norway and Spain.
Previously: Canada Becomes the Second Nation to Legalize Cannabis
Related: WP says Marijuana Legalization Makes World a Better Place
Recreational cannabis is now legal in Canada... to a point. Here are some ground rules:
Adults of at least 18 years old will be allowed to carry and share up to 30 grams of legal marijuana in public, according to a bill that passed the Senate in June. They will also be allowed to cultivate up to four plants in their households and make products such as edibles for personal use.
[...] The supply of recreational marijuana could be limited, at least early on, in some stores. Officials in Nova Scotia and Manitoba said they won't have a large selection, at least not on the first day, CNN affiliate CBC News reported. [...] Marijuana will not be sold in the same location as alcohol or tobacco. Consumers are expected to purchase the drug from retailers regulated by provinces and territories or from federally licensed producers when those options are not available.
[...] Authorities will soon announce plans to pardon Canadians who have been convicted with possession of 30 grams or less of marijuana, CNN partner CTV reported. The production, distribution or sale of cannabis products will still be an offense for minors.
(Score: 2, Touché) by Anonymous Coward on Friday November 16 2018, @12:30PM
ganjaexpress is full of weed ready to order
(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.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(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.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(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.
Priyom.org Number stations, Russian Military radio. "You are a bad, bad man. Do you have any other virtues?"-Runaway1956
(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.
(Score: 3, Funny) by stretch611 on Friday November 16 2018, @04:19PM (5 children)
Please, Please, will somebody please think of the children?
Now with 5 covid vaccine shots/boosters altering my DNA :P
(Score: 2) by takyon on Friday November 16 2018, @05:06PM (3 children)
Evul Drug Dealer: "..."
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 2) by stretch611 on Friday November 16 2018, @08:37PM (2 children)
Actually, I was trying to poke fun at there being a shortage... :)
Whenever something bad happens, think of all the children is usually an overused expression.
Now with 5 covid vaccine shots/boosters altering my DNA :P
(Score: 2) by takyon on Friday November 16 2018, @09:22PM (1 child)
Ya I heard of it. I was transmuting the joke to a higher plane.
[SIG] 10/28/2017: Soylent Upgrade v14 [soylentnews.org]
(Score: 2) by stretch611 on Friday November 16 2018, @10:57PM
We'll let me be the first to admit... WHOOOSH!!!
Now with 5 covid vaccine shots/boosters altering my DNA :P
(Score: 2) by dry on Sunday November 18 2018, @06:08AM
I know that you're trying to make a joke, but that is one of the big arguments for legalization, kids don't have as much access to legal pot then illegal. This shortage means more black market pot and the black marketer rarely asks for ID and many will happily hang around schools to make a sale, especially the to their fellow kids.
Of course the right wing feels the opposite, legalization means more access for kids and it should never happen.
(Score: 0) by Anonymous Coward on Friday November 16 2018, @05:47PM (4 children)
I know a guy who knows a guy. There is no shortage of weed in this part of Canada. And bonus, it's cheaper than government weed.
(Score: 2) by Osamabobama on Friday November 16 2018, @06:21PM (3 children)
Somebody earlier mentioned the invisible hand; do legal weed retailers have the ability to adjust price to compensate for lower supply? These shortages sound like the textbook case for raising prices to reach equilibrium. In contrast, most news stories about shortages involve food or fuel, which have an 'anti-gouging' attitude that keeps prices low (by government fiat) during natural disasters.
In this case, there is no credible argument that marijuana is an essential, so why don't prices rise to meet demand?
Appended to the end of comments you post. Max: 120 chars.
(Score: 0) by Anonymous Coward on Friday November 16 2018, @06:29PM
no cause the demand is for weed legal or not so if the legal price is to high above the illegal weed no legal weed will be sold and that is not the objective of weed legalisation in Canada
(Score: 0) by Anonymous Coward on Friday November 16 2018, @07:55PM
When your competitors don't have supply problems, you can't easily raise prices to compensate for your own self-inflicted issues.
I don't believe people seriously thought it wouldn't be this bad. Everyone with half a brain saw this coming. It is truly unbelievable how the provinces were so unprepared for legalization, even with years to prepare for it.
For example, the fact that the closest retail store to the nation's capital is in Mirabel, about 150km away, just boggles my mind.
(Score: 2) by dry on Sunday November 18 2018, @06:15AM
Weed retailers are limited by having to follow regulations, no cheating with massive doses of fungicides or any other pesticide. And the tax, which is supposed to be designed to be low enough that it isn't a handicap, but each Province is free to set some of that tax and some may go too high.
One of the whole ideas of legalization is to kill the black market, much like the end of prohibition mostly killed off the bootleggers. I can easily find some black market pot if I like, but would have a hell of a time finding a bootlegger, and most of the ones that exist, sell legally or at least semi-legally bought alcohol, just after hours or in a town or reservation where it is banned.
(Score: 3, Touché) by RedGreen on Friday November 16 2018, @11:42PM (1 child)
come see me I have plenty. As usual the government is useless at doing something.
"I modded down, down, down, and the flames went higher." -- Sven Olsen
(Score: 2) by dry on Sunday November 18 2018, @06:27AM
Yet, judging by how my Provincial government handles liquor sales compared to private industry, once they get their shit together, I'm pretty sure that I'll prefer the government operated pot shop compared to big business.
Right now, or just before legalization, the private pot shops were pretty good (and plentiful) as they were run by people who didn't mind selling an illegal substance in a store front because they believed in the product rather then people looking mostly for profit.
Myself, I usually just grow my own.