On cusp of legalization, Canadian cannabis stockpiles hit record

Just Released! Get realistic market forecasts, state-by-state insights and benchmarks with the new 2024 MJBiz Factbook member program, now with quarterly updates. Make informed decisions.

Licensed producers of marijuana in Canada have stored away a record amount of cannabis in the months leading up to legalization, yet analysts still anticipate a significant shortage after initial inventories are depleted – particularly of highly sought-after strains.

According to new data from Health Canada, the country’s 100-plus licensed producers accumulated 96,700 kilograms of cannabis oil and dried leaf through June.

The Bank of Montreal estimates total demand for adult-use and medical cannabis in the first year of legalization will be 337,000 kilograms.

It is the last quarterly update that Health Canada will provide before legal marijuana sales kick off Oct. 17.

The total amount of dried marijuana in licensed producers’ inventories reached 66,400 kilograms (140,000 pounds) at the end of June, a 50% increase from the end of the first quarter.

Cannabis oil inventories reached 30,300 kilograms in the same period, up 107% from the end of the previous quarter.

Alex Shiff, senior consultant for Navigator, a communications firm in Vancouver, British Columbia, expects a significant cannabis shortage in the short term despite the bolstered inventories.

“What Health Canada’s numbers do not take into account is that all cannabis is not created equal,” he said. “Consumers may well prefer a particular strain, producer, brand over another.

“Simply because stores are able to maintain some inventory on their shelves, this doesn’t mean that it is what the consumer is looking for. We could see a run on a particular premium brand, while consumers determine that another LP is producing an inferior product for which there isn’t a market.”

Matt Lamers can be reached at mattl@mjbizdaily.com

To sign up for our weekly Canada marijuana business newsletter, click here.