Ontario’s lousy adult-use cannabis sales decline again; Canada sees modest growth

Ontario was the only province in Canada to see lower month-over-month sales of adult-use cannabis in December, according to new Statistics Canada data – the latest sign that the provincial government continues to struggle to get a handle on the new industry.

Sales in Ontario dropped to just 8.7 million Canadian dollars ($6.6 million) in December, down 1.5% from CA$8.9 million the previous month.

December’s sales are a 25% drop-off compared with October’s sales of CA$11.7 million – the first month of legalization.

Industry sources aren’t surprised by Ontario’s dismal sales figures, because the province has yet to open brick-and-mortar stores.

All sales in Canada’s largest economy thus far have been through the online Ontario Cannabis Store, which itself saw a rocky launch.

The province recently awarded licenses via lottery to 25 businesses, which are required to open their doors in April or face steep fines.

Deepak Anand, a cannabis industry expert based in Vancouver, British Columbia, cited Ontario’s “somewhat dysfunctional” online system and the absence of any physical legal retail stores as reasons for the declining sales.

“It’s not surprising given the horrible rollout of the Ontario Cannabis Store program at the outset in October,” he said.

“We saw the OCS website not able to keep up with demand, call centers were slammed, orders weren’t shipped for a very long time. So there seems to have been some growing pains at the outset of the launch.”

British Columbia and Ontario have been at the bottom of per-person sales since Canada legalized cannabis Oct. 17, 2018.

Canada’s westernmost province suffered through its own growing pains.

British Columbia’s sales of CA$1.23 million are second-last among the 10 provinces, edging out only Saskatchewan’s CA$970,000. Even tiny Prince Edward Island reported higher sales than B.C. in December at CA$1.29 million.

Alberta led Canada with CA$13.5 million in sales in December, followed by Quebec at CA$11.9 million.

Modest growth overall

Overall, Canada’s provinces and territories recorded a modest bump in sales for December.

Sales of recreational cannabis across Canada that month were CA$55.2 million, up slightly from November’s CA$53.2 million and October’s CA$43 million.

Analysts expect sales to improve significantly as more physical stores open across the country and licensed producers deliver a greater variety of cannabis products to wholesalers.

New Brunswick received just 11% of the cannabis products it ordered from cultivators consistently, for example.

December was the first month all 13 provinces and territories reported sales data to Statistics Canada, including Manitoba, which recorded CA$4.2 million in retail sales.

The data includes both online and physical cannabis stores. It does not include business-to-business and wholesale sales.

Matt Lamers can be reached at [email protected]

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5 comments on “Ontario’s lousy adult-use cannabis sales decline again; Canada sees modest growth
  1. Being Responsible on

    This news comes as no surprise. Take for example, the United States Government stepped in on the Famous, “Mustang Ranch”, for errors in their IRS filings, and chose to run the most Famous Cat House in America, and shortly thereafter, filed for bankruptcy.
    The more the government is involved, the less likely, progress will be seen and more agencies are developed because no one has a clue who’s in Command.
    My suggestion: Report on the agencies progress weekly, demand a timetable for the decisions, and keep these folks informed of the countless number of patients suffering until they perform their alligence to the office they hold……..

    Reply
  2. Ziggy on

    The 2 highest sales provinces, Alberta and BC, are the only 2 provinces with legal age limit of 18! Do you suppose that there is a correlation?

    Reply
  3. Alain Brunet on

    NO surprise at all considering Ontario has yet to cleanup it’s act and shut down dozens of illegal storefront operations in Hamilton alone, all of which are siphoning revenue into the black market.

    Both Provincial Liberal and Conservative governments messed up this opportunity to get it right. The biggest mistake for the LIberals was to limit to online sales only with very poor execution in implementing their policies (who would of known Canada post would go on strike??).

    The incoming Conservatives under Premier Doug Ford changed government policy to allow storefronts but are playing catch up in the execution of that policy after incompetently changing the rules days before the lottery of 75 licenses being awared to 25.

    Reply
    • Josh Longton on

      The Ontario Liberal Plan was an LCBO-run OCS Store and Online Model – Starting with 25 stores and proceeding to 190 in 4 years.

      The Conservatives were elected in July of that year and immediately cancelled the OCS Store Model and wanted a Private Store model instead.

      THAT is why Ontario only had Online OCS Access because the delayed store roll out until April — and stores were STILL late because this Conservative government sucks at providing clear direction

      Reply
  4. ryan on

    doing business license by lottery is a disaster and that’s what kicked Washington state in the shins because many of the “winners” of the lottery licenses were NOT the most capable individuals and a large percentage of those hard to get licenses never actually got up and running. Limiting the licenses so much is a racket that keeps regular joes and janes out of the game and fees and exclusivity high.

    Reply

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