Week in Review: Congress delays marijuana vote, more record cannabis sales, Brazil nears legalization & more

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Democrats in the U.S. House of Representatives decided this week to hold off on a floor vote for the Marijuana Opportunity Reinvestment and Expungement (MORE) Act until after the November election, essentially caving to Republican political pressure.

MJBizDaily takeaway: The floor vote, which would have been historic as the first time Congress paid heed to a major marijuana reform bill, was always going to be a symbolic gesture anyway.

The Republican-led Senate never intended to take the bill up seriously this year, which means the loss here is arguably being suffered by the Democratic Party, not the marijuana industry. The Democrats could have taken control of the pro-legalization message, which has proved increasingly popular with U.S. voters of all stripes in recent years.

Nonetheless, the delayed vote is a thumb in the eye to marijuana industry stakeholders who have been spending long hours and plenty of money lobbying members of Congress to get the federal government in line with an MJ policy that most Americans already support.

US states, Canada set more sales records

Both Canada and multiple U.S. state marijuana markets – including Colorado, Illinois and Ohio – continue to set marijuana sales records this summer.

MJBizDaily takeaway: The sales spree that global cannabis markets have experienced the past several months is an indicator the marijuana industry might, indeed, be recession-proof.

Sales have been bolstered by the coronavirus pandemic, which led to the cannabis industry being largely exempted from mandated business closures that have affected other sectors – such as restaurants and bars. As long as the pandemic continues, it’s probable that sales figures will keep increasing.

Brazil poised to legalize medical marijuana, industrial hemp

While U.S. lawmakers continue to stall federal marijuana legalization, a titanic cannabis market in South America is on the verge of opening up.

Brazilian lawmakers have fast-tracked a bill to legalize both medical marijuana and industrial hemp, which could present global cannabis players with a range of new opportunities.

MJBizDaily takeaway: Brazil boasts the largest economy in South America, and if the legalization push is successful, it’ll open yet another import-export market for cannabis businesses in a quickly growing global industry that includes multiple continents and countries.

It’s only a matter of time before the cannabis sector expands even further as more nations repeal prohibitions on both marijuana and hemp. And countries that wait will only lose out.

Marijuana capital raises gain steam

California-based MedMen and Holistic Industries in Maryland announced eight-figure investment capital raises, both solid indications that investor interest in the cannabis space is beginning to resume after a lengthy funding drought.

MJBizDaily takeaway: Both raises – $20 million for MedMen and $35 million for Holistic – are encouraging signs for a cash-strapped industry that’s been starved for investment money.

But cannabis operators can’t exhale just yet, because capital remains tight and both raises involved a significant amount of debt – a less-than-ideal financial situation.

The only thing that will truly bring investors back to the table is ongoing solid performances by publicly traded marijuana companies to demonstrate to investors that their money won’t go to waste.

New Jersey dispensary expansion

New Jersey is getting more medical marijuana dispensaries in the coming months, which will slowly but surely broaden the industry footprint in the state before recreational cannabis is likely legalized there in November.

MJBizDaily takeaway: The long-awaited expansion of New Jersey’s MMJ industry has been literally years in the making and serves as a reminder of just how far many states still have to go in terms of “normalizing” the cannabis industry.

The fact is, many state-legal MMJ markets – think Minnesota, New York and most of New England – are still much smaller than many other programs around the country and aren’t really able to serve the full demands of their consumers.

New Jersey’s expansion will be a step in the right direction in that respect.

German MMJ market facing turbulence

Germany’s medical cannabis industry, which has steadily become the largest in Europe, hit some snags when this year’s harvest was delayed until 2021 and now there’s a reported downturn in insurance reimbursements for MMJ patient purchases.

MJBizDaily takeaway: The delayed domestic grows mean Germany will continue to be fully dependent on imports for the near future. And even when in-country production ramps up, the supply isn’t expected to be enough.

However, enthusiasm about exporting to Germany could cool off if sales stop growing. In the second quarter of 2020, sales in Germany decreased because prices fell in a market that’s becoming more crowded with suppliers and the number of medical prescriptions barely grew.

Sales data for the third quarter will be fundamental to a better understanding of whether the decline in Germany was a one-time anomaly or part of a more worrisome trend.

John Schroyer can be reached at johns@mjbizdaily.com

International analyst Alfredo Pascual contributed to this report.