Weed stocks and edibles sales continue to rise. Certain cultivation centers coming to a close. Concentrates dominating and expanding. There is always plenty of cannabis news to report on. Here are four Canadian cannabis market trends to watch out for in 2021.
Recreational cannabis is now legal in Canada thanks to the framework set by The Cannabis Act which allows for the production, distribution, and possession of marijuana. And while the legalization of recreational marijuana has promoted growth and opportunity for cannabis businesses throughout the country, there is still some legal grey area. In other words, regulations under the Cannabis Act remain somewhat strict, and the penalties for not adhering to certain rules regulations spelled out by the act could result in cannabis-related offences.
Still, stoner entrepreneurial spirits remain high in Canada, as it still the only major economy to completely legalize recreational marijuana, nationwide. And while over the past few years Canada has shown remarkable growth within the marijuana market, there is still progress to be made.
With that said, canna-businesses have every more reason to continue to push for more lenient marijuana legislation in 2021.
So what cannabis market trends should we expect to see in the upcoming year? Read on to find out the cannabis trends that will set the stage for a booming cannabis market in 2021.
1- Continued Shutdown of Major Cultivation Facilities
Bigger did not prove to be better in 2020. With the legalization of cannabis, the marijuana market in Canada is witnessing a steady burgeoning of growth, but perhaps not as fast as some big cannabis companies would have hoped for. Companies throughout Canada are reporting a massive oversupply of cannabis and are now challenged by a broad supply-demand imbalance.
According to an article in CNN, “North America’s largest cannabis companies have struggled as their operational growth far exceeded the actual development of the cannabis industries” One particular company feeling the pressure is giant player Canopy Growth producers, a big-time cannabis corporation based in Smith Falls, Ontario. Just last year, the corporation, in an effort to redeem losses and improve margins, began by “shuttering 3 million square feet of greenhouses.” Needless to say, Canopy Growth’s pot stocks suffered as well, witnessing shares crashing at 18.5% lower in May 2020.
And it seems that was just the beginning of a major downfall for cannabis production facilities that continued to shut down their cultivation operations across the country in 2020.
Taking last year’s lessons into consideration, perhaps the trend for 2021 will be for big-player cannabis companies to streamline operations, and focus on efficiency rather than expansion.
2. Legal Cannabis Sales Continue To Soar
While giants in the cannabiz world strategize their framework for more efficient and profitable gains in the new year, one sector saw more or less steady growth in 2020: cannabis retail sales. According to this graph labelled as “Adult-Use Cannabis Sales by Month in Canada” presented by Marijuana Business Daily demonstrates that “legal cannabis sales enjoy strong growth, and account for a roughly $1.6 billion annual market for legal cannabis in Canada”.
This upward trend of retail sales will only continue to increase in 2021 as retail access and licensing are expanding throughout Canada. Additionally, click and collect delivery methods are making it even easier for wholesalers to enable individual consumers to purchase their bud online, pick up their order at a store, or have it delivered to their home.
Retail stores could still face challenges in the future, including an over-supply component, and adapting to ever-changing legislation around the use and distribution of weed. Yet, the statistics prove to be promising in Canada when it comes to weed retail sales. With that said, we expect to see retail sales increase at a steady rate in 2021 and beyond.
3. Cannabis Edibles On The Rise
Since the legalization of recreational weed, consumption among adults is on the rise in Canada, but one product has seen the most increase: edibles. Edibles are food products that contain cannabis, usually in a higher-potency form. They have become an increasingly popular alternative to smoking. According to one study presented in The Vancouver Sun, “edibles are making a surge, with 36 percent of past-year cannabis users saying they eat it on a regular/occasional basis.” Consumers can find a wide selection of high-quality premade edibles throughout Canada, and some are choosing to purchase their edibles online through reputable dispensaries. Either way, edibles are a trend to be reckoned with in 2021.
4. Cannabis Concentrates: An Investor’s Opportunity
Much like edibles, other market extracts are gaining popularity, offering consumers the highest potency form of cannabis consumption. Moreover, extracts are available in a variety of forms, including oils, distillates, hash, wax, and shatter. In other words, the sky’s the limit when it comes to concentrates, and this is great news for both retail and consumers alike. Cannabis investors should closely follow the cannabis extracts market, as well as their weed stocks, as a great demand for concentrates is projected to continue to increase in 2021. According to an article published in Technical 420, “In 2021, we expect to see increased demand for cannabis concentrates and this is a trend that we believe is flying under the radar.” The result is most likely due to requests for smokeless cannabis products. And while smoking cannabis flower in the traditional way is still popular among consumers, there is no denying that cannabis concentrates could see incredible growth in 2021.
There are other marijuana trends projected to make an impact in 2021, such as big weed corporations restrategising their operations, reducing their carbon footprint, as well as companies seeking credit protection. Despite some foreseeable challenges, the future for recreational weed consumption and distribution in Canada looks bright. After all, the potential for growth within the marijuana market is infinite and is expected to stay on an upward trend for years to come.
