There is absolutely no doubt that Canada has been the global leader in the international cannabis market. Step by step in recent years, reforms at the federal level, starting with regulating medical cannabis, the Canadian government has given its homegrown companies a leg-up on the global competition, culminating with the achievement of becoming the first G7 nation to legalize cannabis commerce. Access to banking services, capital, and export markets have been huge advantages over competitors. The legalized regime has not been without its fair share of headaches, however, as the market has been stymied by a lack of supply of flower and the inability to sell edibles, extracts, concentrates, and other cannabis products, but that prohibition will end soon. Have the regulatory missteps enabled the United States to catch up to its northern neighbor as the global cannabis leader? Neil Selfe, founder and chief executive officer of Infor Financial Group Inc, a Canadian investment firm, told Bloomberg that he feels that Canada has lost its place at the top:
“I think we had a real chance to be global leaders,” Selfe said in an interview at Bloomberg’s Toronto office. Yet eight months after Canada legalized recreational cannabis, Selfe sees Canopy Growth Corp. as the only Canadian pot company he would classify as a global leader, with big U.S.-focused firms outpacing the rest even though marijuana is still illegal at the federal level.
“It’s a real consumer product in big U.S. states where it’s legal, and it isn’t that way yet in Canada despite the fact that we were first,” he said.
States like California sell multiple products, have well-known brands and even allow home delivery,but Canada’s market is restricted to dried flower and oils and branding essentially “doesn’t exist,” Selfe said.
From my perspective, I think that Selfe is being a bit premature, but that he is issuing a healthy warning for the Canadian industry. Canada should maintain its place as the global cannabis industry leader until the United States ends federal prohibition, then the U.S. will likely take the top place, based on a big population advantage, if anything. However, there are still opportunities for Canadian companies and entrepreneurs to innovate and brand themselves as worldwide leaders and insulate themselves from the competitive advantages that the U.S. may enjoy. Legalization in the United States could occur in the next two to five years, so time is of the essence for the Canadian cannabis industry.
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