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Friday, September 18, 2020

Statistics Canada Report: Canadians Spent $5.7 Billion on Pot in 2017

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As Canada prepares to be the world’s first G7 country in history to legalize cannabis, the government is closely tracking the consumption habits of Canadians so they can measure the success of this incredible social experiment. Thus far, the results are clear — Canadians love their weed.

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Statistics Canada released its latest findings on Jan. 25 and the data shows Canadians spent $5.7 billion on cannabis in 2017. People between the ages of 15 – 64 equalling approximately 4.9 million Canadians in total purchased legal medicinal, and illegal recreational, pot last year.

On average, marijuana users spent $1,200 per person on cannabis in 2017, with the majority being purchased on the illegal recreational market. That however, will change. A flurry of new licensed producers are being brought into the cultivation club across the country as Health Canada streamlines the process, making it easier for more to join and for existing licensed producers to flourish.

One such cultivator who is thriving in the burgeoning cannabis industry is Indiva Limited (CVE: NDVA). The London Ontario-based producer has had a string of home runs in the last couple of months, having raised $23 million in its latest round of financing, joining the TSXV on Dec. 19 and ringing the opening bell on Jan. 23. As well, the company entered into a $13 million equity financing deal on the same day.

With healthy financial news like Indiva’s recent success, coupled with data from Health Canada regarding the dramatic increase in medical cannabis patients, not to mention the imminent legal recreational industry, that $1,200 per person will not only increase, but will do so in a legal marketplace.

Another point from the StatsCan report that will undoubtedly interest the government as they determine exact retail schemes, is the price of illegal weed and how it’s dropped in recent years.
The study showed since 1990, the price of cannabis has declined 1.7 percent per year and stood at approximately $7.50 a gram in 2017. In order for the feds to achieve their goal of stamping out the black market, they will need to be competitive with the price on the street.

It also seems that Canadians should need not worry about where their marijuana comes from, as the lion’s share of the $5.7 billion was made from domestic cannabis sales as opposed to imported bud. A total of $5.4 billion was marijuana that was grown in Canada.

The incredible demand for cannabis from Canadians across the country is also evident in the upswing of legal cannabis production. Canada now produces more marijuana than it does beer or tobacco. In 2014, approximately $3.4 billion worth of cannabis was produced, compared to $2.9 billion in the brewing industry and $1 billion in tobacco.

Another positive take away from the Statistics Canada report is the age groups who are purchasing cannabis. The federal government has been incredibly vocal about their intention to get pot out of the hands of minors, and legalization is how they have chosen to tackle the issue. But the job may not be as hard as it seems based on these findings. The study showed that Canadian teenagers spend less on marijuana than any other age group.

40 percent of marijuana purchases were made by individuals between the ages of 25 – 44 years. Citizens between the ages of 18 – 24 years represented 33 percent, and only 18 percent of pot was acquired by 15 – 17 year olds.

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The StatsCan report also shines a positive light on the earlier predictions made by Deloitte in 2016. The firm prognosticated that Canada’s legal marijuana industry could reach $22.6 billion annually. These numbers include a retail market that is expected to be worth up to $8.7 per year and an ancillary service market such as testing labs and security worth up to $12.7 billion.

As the expected July deadline gets ever closer, Canadians should begin shifting from illegal to legal products. Even sophisticated grey market producers, who are currently flying under the radar in most cases, hope to join the legal industry and are attempting to do so. One thing is certain, it is a great time to be involved in the cannabis sector in Canada.

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Disclaimer: This article is purely informative & educational in nature and should not be construed as medical advice. Please use the content only in consultation with an appropriate certified medical or healthcare professional.

Editor
Editorial Staffs at Healthtian, A team of Writers.
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