First legal marijuana sales likely to happen in September or October: Canaccord Genuity

Senators have voted 56 to 30 in favour of passing Bill C-45, the so-called Cannabis Act to legalize adult-use recreational marijuana, a milestone moment in Canadian history, says analyst Matt Bottomley of Canaccord Genuity, who says that there are still a number of significant logistical hurdles to overcome before stores open across the country.

The legislation now heads back to the House of Commons for parliament to deal with a list of over 40 amendments, some of which are relatively substantial: one amendment calls for a prohibition on branded merchandise connected to licensed producers and their wares, another involves limiting the amount of THC in available cannabis, while a third would allow provinces to decide whether or not to allow home cultivation of cannabis.

But Bottomley contends that the amendments are primarily procedural and that the review process could be completed as early as the end of next week.

“With the passing of Bill C-45 by the Senate, we believe a major milestone has been accomplished with Canada set to become the first major country in the world to approve adult-use cannabis at the federal level,” the analyst says in an update to clients on Friday. “As a result, we believe Canada will continue to be a global leader in cannabis regulation, infrastructure, expertise/knowledge and access to capital.”

In their final speeches on the bill, Conservative senators (who made up the bulk of the nay side) spoke of the need for more time to assess the social repercussions of legalization.

“Legalization should be a last resort if incremental approaches to address cannabis-related harms fail,” said Sen. Judith Seidman. “Instead, the government has chosen to conduct a grand experiment on the Canadian public, an experiment that cannot be undone.”

Bottomley says that even with the bill’s passing, a number of issues still remain with respect to the industry roll-out, including the establishment of government-controlled and private-sector retail outlets, the establishment of online sales, the further ramp-up in production by Canada’s licensed producers and the protocol for dealing with impaired driving.

All told, Bottomley says that the likely date for first sales will be sometime in September or October.

“Although logistical hurdles remain, we believe positive industry catalysts are still on the horizon,” he says. “This includes major provinces such as Ontario, Alberta and BC still to announce initial tender allotments for product and the legislation of more recreational friendly products, such as vape pens, edibles and other derivative cannabis product that will become increasingly important for producers as the cultivation of cannabis is expected to become largely commoditized.”

More Cantech Cannabis