Since Canada fully legalized cannabis, over 200 businesses have obtained licensing approvals to operate cannabis-related activities. And while the number of Canadian-based businesses is rather minuscule compared to the 28,000 businesses in the U.S., Canada's legal market is continuing to accelerate and could witness a sizeable emergence of cannabis-based companies. Canada legalized cannabis completely in late 2018, but prior to then, recreational use was decriminalized. Medical cannabis had also been prominent in Canada since the early 2000s, but at the time, health officials only allowed the use of medical cannabis for specific conditions. However, due to the passage of cannabis legislation, Canadian consumers can now use cannabis freely for both medical and recreational purposes.
Additionally, in an effort to accelerate its market growth, some Canadian provinces have decided to issue out more licenses to companies to meet the demands of consumers. For instance, Ontario's provincial government decided to issue 50 more licenses to cannabis stores starting in October this year. Moreover, in May 2019, Alberta pledged to issue out over 115 new licenses over a 6-month period. Now, with the acceleration of licensing approvals, Canada's market is primed to become a major global market driver. Furthermore, the overall North American region has already established itself as a leader within the cannabis market, outpacing every other global market. And according to data compiled by Imarc Group, the North American legal cannabis market is expected to reach USD 35 Billion by 2023 from USD 8 Billion in 2017.
As more businesses continue to obtain licenses to operate, the competition within the cannabis marketspace is rapidly growing. Businesses are required to adapt to the changing environment in order to flourish among heavy competition. In particular, there are several large Canadian-based licensed producers who dominate the industry, making it difficult for smaller and newer businesses to thrive.
As a result, many small-scale producers have decided to engage in cultivating "craft cannabis." Craft cannabis is the result of artisanal profession of meticulously cultivating premium cannabis. Small-scale cultivators excel in craft cannabis because their growhouses are typically much smaller, allowing them to tend to each individual plant to ensure a high quality product. On the other hand, large cultivators are geared towards mass producing cannabis, meaning that most of their operations are automated by machinery.
The major drawback with the use of machinery is that strains can lose their cannabinoid content and are also more likely to infect strains or destroy them by factors such as molding or bugs. The art of craft cannabis is a tedious process, but it allows smaller producers to compete against larger competitors. "Craft growers embody the genesis of this industry," says David Robertson Director of the Craft Cannabis Association. "Craft growers are the fountain from which modern knowledge and cultivars have issued forth to reignite the world's love of cannabis and we would not have any of these world changes without them."
Source: financialbuzz.com