Cannabis shortage across Canada. New laws legalizing cannabis in Canada’s is causing a shortage across the country. Already a Newfoundland private pot shop has closed blaming lack of supply.
Cannabis shortage across Canada
Clarenville’s Puff Puff Pass Headshop is the first to close after trading legally for only three months. It is one of only six shops to service Newfoundland and Labrador, with two in Clarenville. Legal retailers can only buy their stock from one of seven licenced producers. They can only order limited products in specific quantities. Other retailers in the area have similar issues accessing supply. They say they often run out of cannabis products waiting for stock deliveries.
Demand was much higher than their supply
Owners of High North in Labrador said cannabis demand was much higher than their supply. Brenda Tobin said they sold out in the first three hours on the day it became legal. And, then supply dried up for around two weeks. She said the shop stills sells out of weed fast than producers can supply it. This is sending some customers back to the black market. While Tobin hates hearing customers need to do that, she realizes they going to get some way. If she cannot supply it in her legal retail outlet, they will find it elsewhere. Also she cannot put in an order for the products she wants. Instead she has to buying from a list of available products her suppliers send out.
Cannabis retailers closing up shops
Newfoundland is not the only province with a supply problem. Retail stores in Saskatchewan, New Brunswick and Quebec have shut their doors early because of lack of supply. Alberta is expanding its retail network, but shop owners believe supply will not support expansion.
Alberta’s Gaming, Liquor and Cannabis Commission (AGLC) plans 10 more retail licences. This means it will have a total of 75 stores. While there has been some improvement in supply, it has only been a limited over a few weeks. So, AGLC is working to licence another 12 suppliers from across Canada. While the AGLC planned for a high demand from day one, they could not predict the challenges with supply.
New Canadian License Support
But retailers’ question whether the market can currently support new retail licences. Retail store owner in Devon, Alberta, Nicole Felgate said getting stock was difficult. And, they are currently only getting half what they did in December. She said suppliers could not keep up with the demand for dried cannabis, but may or may not have capsules and oils.
Edmonton cannabis retailer, Trevor Miller said his latest order was a quarter the size it was in November. Federal cabinet minister, Bill Blair does not agree. He tweeted there was enough cannabis available to exceed consumer demand.
New Brunswick cannabis retailers fail to open
Temporary closures affected half of New Brunswick’s 20 cannabis retail stores November. They had to close as they waited for stock to come in over the weekend. They reopened later the next week. Cannabis New Brunswick is the sole supplier of in the province. It is a subsidiary of the New Brunswick Liquor Commission and the only legal supplier of cannabis in the province. The company only received around 30% of its order before marijuana became legal. A spokesperson said the situation was not ideal. They said temporary closures were necessary to ensure customers had a choice. There is a high demand for pot products but receiving them to stock is not easy. They expect more consistency soon when supplying legal cannabis becomes more normal. New Brunswick’s OrganiGram chief commercial officer Ray Gracewood said they knew supply would be a challenge. He said the cannabis laws has made cannabis accessible and people wanted to try it. Gracewood said it was shortage was inevitable for the new legal industry. In the meantime, producers are playing catch up to keep up with consumer demand.
Trudeau unconcerned about cannabis shortages
Canadian Prime Minister Justin Trudeau remained unconcerned at pot shortages in December. He said the new laws brought with them the challenge of consistent supply. But he expects that to stabilise over the next year. And he acknowledged the worst shortages were in Quebec and Ontario. He is also less than impressed by Quebec’s new legislation to raise the legal age of 18 to 21. This means you need to be 21 in Quebec to buy legal cannabis. Trudeau said this attitude encourages this age group to buy on the black market. This defies the main point of the new legislation which is to prevent buying on the black market and shut it down.
Cannabis shortages – Why?
Some industry experts predict Canada’s marijuana shortages could continue for years. Most provinces report shortages with some lasting for two weeks at a time. Licensed producers have been unable to keep up with demand despite previous commitments. Toronto company Biome Grow CEO, Khurram Malik, said there were a few reasons for this. He said the tough growing regulations under Health Canada were partly to blame. It makes it hard for the 132 licenced producers to grow quality product that complies.
Getting your Canadian Grow licences takes time
This takes time and the government were slow approving growing licences. It can take anyone new to growing marijuana up to two years to produce consistent volumes of quality product.
Malik said Canada’s growing regulations were tough. Tougher than anywhere else. And compare this to California where it is easier and cheaper to produce. While he said companies may have built up stock, there were packaging and shipping delays due to regulations in a new industry. He predicts there could be occasional shortages over the next two years. As producers grow a regular supply, they will ship products as soon as they have products ready.
Increasing Canadian cannabis grow capacity
Health Canada is improving the licencing and growing capacity. It has increased grow areas from 185,000 sqm to more than 1.2 million since 2017. It acknowledges the shortages and said they will continue in coming months. They will be less common as the new industry stabilises to meet high demand from consumers. With Health Canada’s long stance on cannabis prohibition, it could not predict consumer demand. But it remains confident they can meet demand as the process settles down.
Cannabis shortage challenge
In Nova Scotia, a spokesperson for the Liquor Corporation said it only received 40% of the cannabis ordered before October. They put in an order with 14 licenced producers who could not meet the demand. A Prince Edward Island producer helped them out with product to plug some of the shortfall In the first week of the new legislation, retailers in Nova Scotia had to close early three times because of the shortfall in supply.
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