Two years after Canada legalized recreational cannabis, the country is awash with the stuff.
Hundreds of thousands of kilograms of cannabis sit idle in producers' vaults. Warehouses operated by provincial wholesalers are filled to the brim with finished products. Meanwhile, illicit growers remain active and add to a country-wide stockpile that is far outpacing market demand.
The mountain of cannabis is expected to balloon further once producers – both legal and illicit – finish their "Croptober" harvest, the term used within the cannabis industry in reference to the period around October when outdoor cannabis crops are chopped down and processed.
"There has been too much cultivation in Canada," said Rahul Sarugaser, managing director of equity research at Raymond James, in a phone interview. "But that is secondary to the fact that there have been too many players and as a result, there's too much competition in the market."
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