Canadian cannabis shortages expected to last years

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Cannabis retailers across Canada have struggled to supply consumers with product since the country legalized recreational cannabis five months ago, and industry experts say that this trend is likely to last for a few years.

George Robinson who runs RavenQuest, a cannabis biomed firm, told sources that supply shortages are expected to last at least five years.

“We’re absolutely not getting anywhere close to the (needed) supply,” said Robinson. He added that approximately 5 million kilograms are needed to satisfy the demand for recreational cannabis across the country. Suppliers are currently growing less than 10 percent of that amount. Therefore, there simply isn’t enough cannabis being distributed to retailers.

In Quebec, some shops are only able to open three days per week thanks to supply shortages and the New Brunswick provincial retailer has had to lay off 60 employees. Thomas Clarke, the owner of a retail shop in Newfoundland told sources that he had no supplies for two weeks and expects that the $16,000 shipment he just received will only last a few days.

Clarke told sources that owners of black market businesses poke fun at him over the supply issues.

“They laugh at me,” said Thomas Clarke who runs a cannabis store in Newfoundland. “They say ‘Ha ha, you don’t got any cannabis in your store, you’re only making seven-and-a-half per cent (profit) … our business on the black market is thriving and we’re making 100 per cent,” said Clarke.

When it was first being decided that cannabis would become legal in Canada, the liberal government said that it would greatly reduce crime rates and activity related to the black market, but shortages across the country have seemed to only induce more black market activity.

Executives from leading Canadian cannabis supplier Aurora Cannabis have also recently weighed in with concern about lengthy supply shortages.

“It will be at least five years until we have an oversupply situation,” said Aurora Cannabis Inc’s CEO Terry Booth. He also told sources “I lose sleep over our ability to supply this global cannabis market.”

Aurora kicked this week off with revenue of $54.2M in their second quarter, an 83 percent increase from the last quarter. These numbers have reportedly met with experts’ expectations. The results clearly show a strong demand for cannabis since it became legal, but the company understands that supply is still low across the country and that this issue calls for restructuring.

“We need better retail infrastructure across the country to see the level of sale everyone is anticipating. It will take a couple more quarters,” said Aurora’s Chief Corporate Officer Cam Battley.

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