Canada edition / April 29, 2020
SHARE:

Connect with WeedWeek on TwitterFacebookInstagram and LinkedIn!

Join us for the WeedWeek News Brief, a free weekly webinar where WeedWeek journalists recap and discuss the latest news. It airs Fridays at 10 a.m. Pacific Time on Zoom. Register today!

Check out the latest episode.

 

1 OTTAWA OFFERS COVID RENT-, WAGE-RELIEF TO CANNABIZ

image
Paul Sableman / Wikimedia Commons

Last week, Ottawa announced the Canada Emergency Commercial Rent Assistance program, which will pay 75% of rent for small businesses struggling with COVID-19. The program will launch in mid-May.
Press Release, Cannabis Retailer, Globe and Mail

  • Ottawa will pay half tenants' monthly rent. Landlords and tenants will each be asked to pay one quarter.
  • The program will be administered through landlords, so only those businesses whose landlords apply for CECRA will receive it.
  • Businesses that pay more than $50,000 in rent are ineligible.

The National Research Council, meanwhile, confirmed cannabis businesses with fewer than 500 employees will be allowed to apply for wage subsidies from the NRC's $250M Industrial Research Assistance Program (IRAP) available to companies "[pursuing] growth and profit by developing and commercializing innovative, technology-driven new or improved products, services or processes in Canada."
The Rise

This week on the podcast
Nikki & Swami Farm the Living Soil

Swami Select founders Nikki Lastreto and Swami Chaitania met in San Francisco during the Summer of Love, coupled in 1980, and started their Mendocino County farm in 2003. The couple share their transition from globe-trotting seekers to practitioners of regenerative farming. 

  • Nikki and Swami have applied growing principles learned in their travels to India and Asia.
  • Nikki sold pot while working as a journalist for the San Francisco Chronicle and KRON.
  • Swami Select is one of the few cannabis farms to commit to the regenerative farming, an agricultural approach geared toward restoring the earth.
A note from the editor

Since 2015, WeedWeek has been the best way to keep up with the Green Rush. WeedWeek’s audience includes many of the most influential figures in cannabis because we are editorially independentAdvertisers have no influence on our editorial content.

We publish three free newsletters:

1) WeedWeek by founder Alex Halperin

2) WeedWeek California by Donnell Alexander

3) WeedWeek Canada by Jesse Staniforth As well as the WeedWeek Podcast and original reporting.

The original WeedWeek newsletter has 11,000 subscribers.

Tips, comments and complaints to Jesse jesse@weedweek.net.

To advertise with us contact events@weedweek.net.

2 NO RENT RELIEF FOR STORES UNDER CONSTRUCTION

image
Public Domain

The Canadian Chamber of Commerce's National Cannabis Working Group warned Ottawa's rent-relief program will exclude the nearly 200 REC retailers preparing to open in Ontario.
Twitter--@CCC_Cannabis

The Canadian Chamber of Commerce's cannabis lead Ryan Greer said "there are a bunch of dark sites where construction has been paused and openings are delayed – they’re paying rent and they should be eligible for these programs."

 

3 NEW ONTARIO RETAIL COMING SOON

image
Public Domain

The Alcohol and Gaming Commission of Ontario announced it would resume issuing Retail Store Authorizations (RSAs) to stores that were already complete before Ontario's emergency order to close businesses and stop work on construction projects. Once a store has received an RSA, it may open its doors.

Meanwhile, the Ontario Cannabis Store is working with LPs to ready farm-gate sales for a post-lockdown launch. OCS chief commercial officer Cheri Mara discussed this and other subjects during a Reddit Ask Me Anything last week. Since then, industry experts have picked through and discussed her answers.
MJ Biz Daily, Cannabis Retailer

4 LAST MONTH OF PRE-PANDEMIC SALES BETTER THAN IT LOOKED

image
Coastal Elite (Halifax, NS) / Creative Commons

In the last month before COVID changed everything, February's REC sales fell to $149.9M from the previous month's $154.1M. Worth noting: that 2.7% decline actually represented a 7.7% increase when adjusted for February's fewer days per month.
MJ Biz Daily, Twitter--@ProfMJArmstrong

How did the pandemic affect 4/20 sales? Retail POS-software platform Cova produced an infographic showing US sales were down 50% or more on 4/20, and Canadian sales trailed behind them.
Cova

CIBC Capital Markets lowered its 2020 REC sales forecast by nearly $1B, predicting $2.5B in sales rather than its earlier $3.4B estimate.
MJ Biz Daily

Most consumers under 40 are likely to buy REC through legal channels, while older consumers tend to continue buying illegally. In both legal and underground markets, loose flower predominates (slightly more popular on legacy market, while the legal market offers more pre-rolled joints). Shoppers spend about the same amounts in either market.
Cannabis Retailer

5 WEEDMD FURLOUGHS 40, FIGHTS UNION, AND OTHER CORPORATE NEWS

image
JRodSilva / Wikimedia Commons

London, ON-based LP WeedMD announced temporary layoffs for 40 employees and 25% pay-cuts for management and directors. At the same time, the union representing some of the company's production employees refused a company request for it to name the employees who have signed union cards.
Press Release, GrowthOp, London Free Press

  • Lawyer Harrison Jordan said of WeedMD's request for the names of union card signatories, "You should never predict the outcome of a case [...] But WeedMD will lose this one."
    Twitter--@harjord

In other corporate news:

Days after announcing it was pulling out of its Latin American assets, Canopy Growth announced a supply deal with Colombia's Clever Leaves.
Press Release

Tilray claimed the $130M lawsuit against them by 420 Investments (owner of REC retailers Four20) was a "defensive tactic" by the retailer in order to default on a $7M "bridge loan" it received from Tilray's REC subsidiary High Park.
Calgary Herald

Supreme appointed former Hain-Celestial Canada CEO Beena Goldenberg president and CEO.
NewsWire

Sundial, which recently temporarily reduced production due to COVID-19, recalled 30,000 of its Top Leaf Strawberry Cream pre-rolled joints sold in Manitoba, Alberta, and BC due to much higher THC content than labelled (the pre-rolls have 10.9% THC but are labelled as containing 1.09%).
MJ Biz Daily

  • Sundial said it had "not received any complaints related to the recalled lot."

LPs continue working to raise capital. Flowr announced a $20M non-brokered private placement. while Organigram announced a $49M at-the-market equity program. (Organigram also debuted its "Trailer Park Buds" REC brand, which appears to violate Cannabis Act prohibitions on associating with people or characters.)
New Cannabis Ventures

 

6 FANTINO, EX-RCMP CHIEF SOUCCAR OUT AT ALEAFIA

image
Korea.net / Korean Culture and Information Service / Wikimedia Commons

Aleafia announced former Toronto police chief Julian Fantino and former RCMP deputy chief commissioner Raf Souccar have resigned their positions on the company board, where Fantino was chair and Souccar sat as a director. The company did not provide an explanation for Fantino and Souccar's departures.
Reston Recorder

Departing chairman Fantino is remembered for saying, prior to his arrival at Aleafia,

REC retailer One Plant, roughly 10% of which is owned by Aleafia, announced plans in December to open a store in Toronto's Kensington Market, prompting protests against Fantino.
BlogTO, Twitter--@MetroManTO, CarymaRules

  • One Plant's Kensington location opened in early April (receiving a fawning profile from BlogTO). On Tuesday, One Plant co-owner Jason Krulicki tweeted, "We listened to the community and were able [to] affect change" along with the news of Fantino's departure, suggesting it came in response to those protests.
    BlogTO, Twitter--@JasonKrulicki

 

Quick Hits

  1. BC Compassion Club Society founder Hilary Black, now chief advocacy officer at Canopy, said too many MED patients face barriers to access. She called for MED to be covered by private health insurance,  better education for physicians about MED, and redesigned workplace policies that don't discriminate against MED users.
    GrowthOp

  2. An Amherstburg, Ontario nurse crossing the US border to work in Detroit was arrested with 150 pounds of cannabis. She faces 20 years in prison in Michigan, where REC and MED are legal at the state level.
    CTV News

PRE-ORDER "THE CANNABIS DICTIONARY!

7 RESEARCHERS CONSIDER MED FOR COVID-19

image
UGA CAES/Extension / Creative Commons

A pair of University of Lethbridge epigenetics researchers, Drs. Olga and Igor Kovalchuk, argued high-CBD tinctures (not commercially available) could be used to protect mouth, lung, and intestinal tissues from allowing COVID-19 transmission.
CTV News, Stockhouse

  • Their theory is based on preliminary data and requires additional research, but the Kovalchuks are legitimate, award-winning researchers and they've submitted their work to an unnamed journal for review.
  • The US Food and Drug Administration has warned against unsubstantiated claims that CBD treats COVID-19, and the US Federal Trade Commission has cracked down on similar claims. Still, we can likely expect the very existence of this research to be misinterpreted by wingnuts.
    Cannabis Industry Journal, WeedWeek, FTC

 

8 REC RETAIL COMES TO SMALL-TOWN SASKATCHEWAN

image
Saffron Blaze, via http://www.mackenzie.co

Saskatchewan's Liquor and Gaming Authority opened applications for REC store permits in communities of fewer than 2,500 people.

  • Small towns offer retailers direct access to rural populations that don't often visit urban areas, but operating in a small-town economy can be more complicated than opening in a city.
    CBC Saskatchewan
  • Applications for permits in Saskatchewan municipalities with more than 2,500 people will not open again until September.

Quick Hits

  1. Hamilton, Ontario has updated a bylaw to crack down on "nuisance" odours caused by cannabis growers, but home growers say the language can be widely interpreted to ban nearly all growing.
    Hamilton Spectator

  2. Some LPs are still advertising on Snapchat, which may or may not be legal.
    Radio-Canada—In French

9 “REAL” PINK KUSH

image
Homies In Heaven / Creative Commons

Pink Kush is one of the most reliably popular cultivars in any Canadian market, yet in a profile about Canada's preference for the strain Leafly noted it's largely unknown in the US.
Leafly

Definitions are a spot of contention. After Ontario Cannabis Store chief commercial officer Cheri Mara's Reddit Ask-me-Anything last week, during which she said the Ontario Cannabis Store was working on "a clear definition of what craft means for the Ontario market," growers predictably cried foul.
Mugglehead, Reddit

10 ASSESSING BEVERAGES

image

After last week's round of new REC beverage offerings at the Ontario Cannabis Store sold out in under 24 hours, consumer responses have begun to trickle in.

Consumers have begun experimenting with powdered infusers, with which they can add cannabinoids to any drink.
Twitter--@hartsteinfeld, @ashleighshecann

Depending on whom you ask, the 2.0 rollout is either going well -- an RBC analyst said the rollout has been stronger than expected) -- or poorly --a CIBC Capital Markets analyst expressing surprise "at the lack of readiness for the launch of derivative products".
BNN Bloomberg, Twitter--@matt_lamers