A recent editorial in the Canadian newspaper, The Globe and Mail, by a University of Toronto sociologist reviewed the brief history of cannabis legalization in Canada and concluded in rather unequivocal terms that by and large, we as a nation have come through legalization and are now moving on.
“Canada took a fairly restrained approach to the initial rollout of legalization, and it seems to have paid off. The sky has not fallen, use has not skyrocketed, and a steady increase in the proportion of legal sales mean public health and safety are being strengthened”, stated Akwasi Owusu-Bempah, the director of research for Cannabis Amnesty at U of T.
According to the data, legal cannabis sales, in the form of retail and medical distribution channels, totalled $1.28B (CAD), about 1.8x illicit distribution; this is a remarkable turnaround from just three years earlier, where illicit sales were $1.2B and legal sales were just over $175 million.
The author, a faculty member at U of T, also noted that societally we did not experience any ‘Reefer Madness’ hysteria moments that were initially anticipated, if not predicted by some. Perhaps this was due to the high rates of cannabis use among the Canadian population generally, which created the groundswell support that prompted cannabis reform at the federal level in the first place.
That is not to say that certain societal and safety concerns don’t remain. Drug-impaired (as well as alcohol and text-impaired) drivers still present a real and tangible risk to those taking to Canadian roads, and after years of successfully reversing the trends of tobacco smoking, respirologists may be faced with increasing cases of lung-related illnesses from increased cannabis use.
Two years ago, I wrote an article about how people across the country were opening their first government-approved, and duly excise tax-paid cannabis containers only to find disappointment waiting for them inside, in the form of dry, stale, and underweight product they were about to consume.
In the early days, cannabis products, in the form of flower, pre-rolls, and other basic consumption products were generally horrible, as much had been sitting on shelves for as long as two years prior to them being legally available. Moreover, other derivative products such as extracts, vapes, waxes, as well as various edibles would not be sold for at least another year from when the piece was published. To paraphrase an old cigarette ad from the 70s, we’ve come a long way baby…
As the article goes on to allude, evidence of the change in both attitude and consumption patterns has appeared in the commercial real estate market, where generally weak demand for rental space caused by business failures and closures due to the Covid-19 pandemic has been softened in some areas by the opening of something like 2,500 new retail cannabis outlets across the country.
This growth has been uneven, for sure, with certain urban markets being well served and other farther flung locations still waiting for a retail outlet. To compound the confusion, many jurisdictions and municipalities made the decision in advance to ban commercial sales of cannabis on their streets. Based on the commercial tax intake of the areas that have accepted these new merchants, this is a decision some municipalities may regret.
There’s no doubt that “cannabis 2.0 products” (as they were referred to at the time), more so than the pandemic, has changed both the consumption patterns and acceptability of cannabis generally in Canadian life; this was predicted by many industry experts who spoke at our last O’Cannabiz Conference in 2019.
In the Canadian Cannabis Survey 2020, compiled by Statistics Canada, both the smoking and the eating of cannabis derivative products have increased slightly from 2019, with two-thirds of respondents reporting occasional use and more people associating the product with lower health risks over alcohol or tobacco.
The elephant in the room might be whether the Covid-19 pandemic has had any influence on cannabis consumption, in Canada or elsewhere. Based on the study, 56% reported using the same amount of cannabis, 22% reported using more and 22% reported using less, so that sounds like pretty much a wash.
In light of the progress we’ve made as a country as it relates to cannabis, there are big opportunities for those in the industry or are interested in the space. The first relates to retail distribution of cannabis. This field of enterprise has migrated quickly to mainstream distribution in commercial areas of city streets.
Where the provincial government has taken absolute control of distribution, such as Quebec and Nova Scotia, retail success is largely guaranteed or rendered moot. In other markets, where the government controls distribution at the wholesale level, as a retailer there are few opportunities to promote one’s business, as it contains adult-use products and general media advertising is prohibited. Strategies for retail consumer success will separate the good performers from the business failures and this will be a key focus for our 2022 Conference & Expo.
Post alcohol prohibition in Canada, the Liquor Control Act of 1927 allowed for the sale of alcoholic beverages for individual purchase, but public drinking in public settings, like pubs, taverns, restaurants, etc., was still a no-no.
It took another seven years, before you could get a beer in a beverage room and probably another three before you could get a glass of wine with dinner, things we take for granted in permitted venues today.
In the U.S., prohibition ended in 1933 and even to this day there are 83 dry counties in nine different states. It seems there are and will continue to be holdouts regardless of what the vice is. What direction will Canada head? We’re still waiting for the smoke to clear.
Cannabis tourism, travel, and hospitality is an area that is yet to gain traction here, but surely can’t be far behind. Humans are social animals, and it won’t be long before those who have historically consumed cannabis in the company of others in private locations will want to do so in public venues. Reason overtook regulation with respect to alcohol. I look forward to the next three years post-legalization here in Canada to see what changes are in store.
