MedLock | December 9, 2020
With approximately half the population claiming to have used cannabis products, it is safe to say that cannabis use is quite prevalent in Canada. On October 17, 2018, Canada became a pioneering country for the legalization of the sale and use of recreational cannabis. This further perpetuated Canadians' use and acceptance of cannabis products. While cannabis sales were predicted to soar upon legalization, the question remains: has it lived up to these great expectations in the year 2020?
The Canadian Cannabis Industry in 2020
Over the last few months, the cannabis industry has seen an increase in sales. The COVID-19 pandemic has given individuals an even stronger urge to consume cannabis. With the current increase in sales, the lows at the beginning of the year have quickly been overturned.
The recent increase in sales comes after several months of low sales, and Canadian Licensed Producers (LPs) suffered many losses during this period. This instability has left many wondering about the future of the Canadian cannabis industry and whether it is the right time to re-enter the industry given the recent increase in sales.
Trends in 2020
Several analyses were conducted on the Canadian cannabis sector, which shows how far the market has gone since legalization. This year has seen a period of strong growth for the Canadian cannabis industry, which was forecasted by industry analysts.
In June, federal cannabis reports showed that the nation had generated more than $200 million from cannabis sales. These figures were higher than the revenue generated in January, thereby signifying a rising tide in sales.
Cannabis sales in Canada increased by approximately 30% in June 2020. However, the sales figures in July and August were even more impressive. Cannabis sales in July 2020 reached more than $230 million. This figure continued to rise to approximately $245 million in August 2020.
Expansion of Cannabis Product Formats
With the continued increase in sales, the Canadian cannabis industry projected to generate more than $2.7 billion in annual revenue. Compared to 2019, the Canadian cannabis industry has witnessed a tremendous increase in sales. This may be attributed to the legalization of cannabis-infused product formats in December of 2019.
As of right now, it is believed that cannabis sales in Canada will continue to increase with a rising demand for new cannabis product formats in the upcoming years. Many licensed producers in Canada have come under pressure due to slow starts, but with the sales numbers rising, this trend is expected to change.
Changes to the Global Market
Another potential reason as to why Canada’s cannabis sales have been increasing could be changes in the international market. With more countries beginning to legalize cannabis, there seems to be both a growing acceptance of cannabis use as well as feelings of optimism for the proliferation of opportunities within the industry. Circumstances seem even more favourable with legalization occurring in many parts of Europe as well as South America.
Hope for the Future
Despite a growth of cannabis sales within Canada, there is still a certain degree of uncertainty regarding the future of the industry. As such, cannabis companies and LPs need to remain adaptive and be ready to evolve as the market matures. For now, we hope the Canadian cannabis industry maintains rising sales in the upcoming years.