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Marijuana in Canada: assessing the potential

The government has been studying the issue for much of this year.

Part of the groundwork has been set by its handling of medicinal marijuana production and distribution. Ottawa set the bar extremely high for companies growing medicinal marijuana. It’s very difficult to meet the standards, as many would-be applicants have learned. The investment in crop quality consistency and security is substantial. The paperwork is extensive. The monitoring is comprehensive.

It’s clearly not for those easily discouraged or those with shoestring budgets. And the template will undoubtedly be the same for those growing cannabis for the recreational market. The regulations will be restrictive and distribution channels will be under tight controls. The security protocols will be daunting.

PUBLIC SENTIMENT IS SPLIT

It’s important to note that public sentiment is clearly split on the issue. The recent Deloitte study of 5,000 Canadian found about 40 per cent of respondents favour legalization, with 36 per cent opposed and the rest undecided.

The Deloitte report finds that about 22 per cent of the population use marijuana recreationally “on at least an occasional basis,” while an additional 17 per cent indicate a willingness to try it if it were legal.

Deloitte notes that on recreational sales alone, the Canadian market could generate about $5 billion per year to start. If you add in those who indicate they are “likely to consume” the product, sales would be as high as $8.7 billion. Deloitte estimates it would require over 600,000 kilograms of marijuana each year to supply even the low-end level of recreational consumption.

GOVERNMENT SURVEY

The government hosted its own online survey, though the results have not yet been released. But as the Toronto Star noted, the survey attracted 30,000 respondents, compared to 47 who offered input on proposed changes to the Canada Pension Plan.

You only have to look to Colorado to get a sense of how large an industry it can be across Canada. A Time magazine report found legalized marijuana was a $2.4 billion industry in the state in 2015. It was clearly the fastest growing business sector in the state with the creation of 18,000 jobs, according to the Denver-based Marijuana Policy Group.

The Canadian Medical Association, in its submission to the federal government’s task force, offers several key recommendations. It calls for a minimum age of 21, that there be no consumption in public areas due to the risks associated with second hand smoke, and that no home cultivation be permitted.

The countdown is underway. The government is preparing its tools of governance. It’s unlikely implementation will be swift – the process will stretch over a number of years.

But its impact on Canadian greenhouse horticulture in general – in terms of lighting technologies, alternative crop interest and career opportunities – will be significant.