More than four years later, Canada's cannabis industry is starting to come down from a post-legalization high, experts say. "Producers have been scaling back, laying people off, closing facilities for really over three years," said Michael Armstrong, an associate professor of operations research at Brock University in St. Catharines, Ont.
"In the first six to nine months of legal sales, the industry was frantically expanding, trying to get the product out the door. We had product shortages for the first six months, but by summer 2019, we're already in a surplus situation."
"So since then, they've been scaling back. But meanwhile, we've had lots of smaller companies join the market, so there's lots of transition going on."
Armstrong also says the overcapacity has had a dramatic impact on the price as well, with prices plummeting from more than $7.00 per gram to $3.00 per gram in some areas.
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