The slow takeoff of recreational marijuana sales in Canada was expected to gain speed in October, when Canada planned to allow producers to add vapes, edibles, beverages, and the popular CBD to their sales of the dried flower that became legal last year. But a briefing Friday by the country’s medical regulator Health Canada confirmed rumors that sales of these second wave products won’t begin until late December.
That means revenues from these so-called Cannabis 2.0 products won’t become meaningful until the first quarter of 2020, GMP Securities analyst Rob Fagan said in a note late Friday. In U.S. states that allow vape sales, the products are becoming as popular as smokable flower. So Canadian marijuana producers like Canopy Growth (CGC), Aurora Cannabis (ACB), Tilray (TLRY), and Aphria (APHA) have been eager to launch vape products.
“This could potentially have a timing shift impact for our forecasts relative to Cannabis 2.0 products,” Fagan warned.
Read more in our recent story: Marijuana Sales Are Soaring. Marijuana Stocks Are Not
With its 38%-owner Constellation Brands (STZ), Canopy says it’s been developing cannabis-spiked drinks that will taste like familiar alcoholic beverages, but be free of alcohol and calories. Now, those products will arrive later than many hoped.
Read our recent interview: Why Aphria Is a Better Marijuana Stock Than Cronos, According to an Analyst
Health Canada said its rules for the new products will take effect Oct. 17 of this year. Producers can then start notifying the agency of the products they’d like to sell. But they can’t ship products for 60 days after giving notice.
So no vapes or edibles will reach retailers’ shelves until Dec. 17.
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