Canada edition / June 30, 2020
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1 FALLING PRICES ARE GOOD, RIGHT?

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Bigoteetoe / Creative Commons

Econo-style value brands are beginning to dominate REC sales--and in response, REC stores have begun seriously cutting prices.
MJ Biz Daily

BC LP Tantalus Labs CEO Dan Sutton warned lower price products will favour bigger companies able to produce cheap product. He suggested expecting to pay $10/gram to keep micro-cultivators and small LPs functioning, while "$7/g buys a small market with large players."
Twitter--@DSutton1986

As for ultra-premium product, not everyone's a fan.
Twitter--@WhatsMyPot

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2 CONSUMERS LOVE MINI PRE-ROLLS

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Redecan

This week's most talked about product is Redecan's "Redees": boxes of small pre-rolls designed as enough for one person (sometimes known as "Dogwalkers" after a U.S. brand).
Global News

This Week in 2.0 Product News:

AlbertaCannabis.org, the crown online REC retailer, announced it will stop selling REC chocolates until September 7 due to the products melting.
MJ Biz Daily

Aurora's new "THC Citrus Shots" may resemble 5-Hour Energy products, but they're classified as ingestible extracts-- not drinks -- meaning they skirt Health Canada's bizarre equivalency scale limiting beverage purchases by weight rather than potency. (This hasn't helped Canadians' confusion about what THC numbers listed on packaging indicate about potency.)
Twitter--@jefflagerquist, @_DeepakAnand, Drug and Alcohol Dependency

  • Canopy CEO David Klein called federal beverage equivalence regs "a flawed concept," while lobbyists representing Fluent and Truss have appealed to Ottawa to relax some REC beverage rules.
    Yahoo Finance

Unity Marguerite, buyer for Vancouver REC store Village Bloomery, reported so many vape-cart producers have "issues" (production, ethical, etc.) that 510-thread cartridges are getting hard to source.
Twitter--@UnityMarguerite

Quick Hits

  1. Canada continues to stymie cannabis researchers with strict research regulations and long delays in granting research permits.
    GrowthOp
  2. Border busts keep getting bigger: US Customs and Border Patrol intercepted 9,500 pounds of flower on the Peace Arch bridge between BC and Washington and charged one.
    WHAM-13

3 DRUG-FOE TONY CLEMENT JOINS LINTON ON SHROOM BOARD

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Damien D / Wikimedia Commons

Former federal cabinet minister Tony Clement, longtime aggressive opponent of harm reduction, took a position as senior advisor to Red Light Holland, a company that produces and sells "a premium brand of magic truffles" to Netherlands' REC market.
CBC Montreal, CMAJ, CBC Technology, the Star, The Tyee, iPolitics, Globe NewsWire

Predictably, many people accused Tony Clement of being a hypocrite whose actions left people to die.
Twitter--@infosecivy, @jerallingham, @danalarsen, @garthmullins, @gilliankolla

  • Disclosure: I have volunteered with homeless people and IV drug users for over a decade, and thus I don't have a kind word to say about Tony Clement, other than that he has blocked me on Twitter.

4 TERRY BOOTH LEAVES AURORA BOARD

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Niccolò Ubalducci / Creative Commons

Aurora announced its founder and ex-CEO Terry Booth retired from his position on the board of directors, effective last Friday. Booth left the chief executive position in February.
Newswire, MJ Biz Daily, BNN Bloomberg

CanniMed Therapeutics founder Brent Zettl suggested Aurora will likely leave the MED field to focus on REC products alone.
Global News

5 CANOPY/ACREAGE SLASH PRICE ON MERGER

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Canopy Growth and Acreage Holdings Logo (CNW Group/Canopy Growth Corporation)

Canopy redesigned the terms of its conditional deal to buy U.S. REC player Acreage Holdings, and will now pay roughly US$843M instead of its previously promised $3.4B.
New Cannabis Ventures, Financial Post

Quick Hits

  1. If, like me, you've never heard of a cannabis germplasm repository (CGR) and don't know why Canada might need one, this article explains how such a thing would protect the genetics at the core of the sector.
    Greenhouse Canada
  2. Responding to pressure from MED advocates, Health Canada extended the expiry date of registrations for licensed home MED growers by six months.
    Twitter--@MedCannCA, Health Canada, StratCann

6 DYNALEO SET TO OPEN GIANT GUMMY PLANT

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Joss D / Creative Commons

When licensed edibles producer Dynaleo opens its factor near Edmonton, AB, it will be the largest REC gummy factory in Canada.
Edmonton Journal

In Other Sector News:

The REC industry has grown 231% since legalization, and last week Health Canada issued eight more licenses, for a total 417 federally licensed parties. Former Health Canada cannabis team member David Brown crunched annual licensing numbers and found the regulator has licensed more LPs this year than in the four previous years put together.
Twitter--@Drowbb

  • There are so many LPs, New Cannabis Ventures revised the rules for including a company among its Canadian Cannabis LP Index.
    New Cannabis Ventures

Auxly joined other LPs in retracting its overseas commitments, halting planting for the 2020-2021 growing season at Uruguayan subsidiary.
MJ Biz Daily

The bright side of low stock prices is distressed assets are priced to move.
Bloomberg

7 BC CROWN RETAILER SAYS IT DOESN’T HAVE ADVANTAGE

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Northwest / Wikimedia Commons

The BC Liquor Distribution Branch, which operates BC Cannabis Stores, rejected claims by private REC store operators that the province pays less for wholesale product.

  • Grower Aaron W Anderson suggested the BC LDB was being evasive and not disclosing where its real margins actually are.
    Twitter--@AaronWAnderson

A BC LDB spokesperson said "I think the private retailers had a bit of an advantage" because many operated in the grey market before being licensed.
Castanet, Kelowna Daily Courier, StratCann

Rumour has it BC will open private delivery and online sales before 2021, and farm-gate sales next year.
Twitter--@drowbb

8 ONTARIO RETAIL HEALTHY ENOUGH FOR TOO MANY STORES

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Daniel_jksn / Creative Commons

Ontario celebrated its 100th authorized retail store last week, as provincial regulator AGCO has ramped up its approvals to grant 24 Retail Store Authorizations in 26 days. We've come a long way from last year's REC retail lottery chaos.
Twitter--@ONCannabisStore, @MattPMaurer

Hot after a booming first year, REC chain Fire & Flower paid off $27.17M worth of unsecured convertible debentures. The company was also spotted advertising on Pornhub.com (an age-gated site, one presumes). Jason Spatafora, owner of MarijaunaStocks.com, said ads on the site were "surprisingly cheap" and offered "great" return on investment.
NewsWire, Twitter--@BettingBruiser, @WolfOfWeedSt

 

9 ONTARIO SEES FIRST LICENSED FIRST NATION REC STORE

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Liam Quinn / Wikimedia Commons

The first Indigenous owner of a licensed Ontario REC store opened his doors in Nipissing First Nation, west of North Bay. Many first nations have non-licensed dispensaries within their territories, but Nipissing FN's Northern Zen Cannabis is the only one licensed by the Ontario government.
Bay Today

10 EXPUNGEMENT AND EQUITY: QUESTIONS LINGER

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Cranberries / Creative Commons

Campaign for Cannabis Amnesty (CCA) director Annamaria Enenajor called the federal government's cannabis record-suspension program an "abject failure," arguing the program's high rejection rates result from unclear eligibility criteria.

Only 436 of the estimated half-million Canadians with possession records have received pardons since the pardon system was launched last year.
Huffington Post, Law & Style, Twitter--@Nick_Pateras

  • Enenajor said the onus should be on Ottawa to suspend records, not on those convicted under prohibition. The CCA continues to push for expungement of cannabis possession convictions from all databases.
  • David Brown, Health Canada cannabis team member turned founder of StratCann, called expungement a "myth" that is "not logistically possible."
    Twitter--@drowbb

The Campaign for Cannabis Amnesty stresses prohibition disproportionately affected Black and Indigenous Canadians. As the U.S. sector faces the challenge of confronting the racism of prohibition, Filipina-Canadian cannabis educator Abi Sampson called for the Canadian sector to build equity programs to address that disparity.
Medium, Twitter--@HiHeidiHigh

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