While many other industries struggled to keep their doors open, 2020 and the Covid pandemic sent cannabis sales soaring to new highs as consumers stocked up on so-called “vice” goods.
According to Leafy, Americans spent $7.6 billion more on cannabis products in 2020 than in 2019, with sales increasing from $10.7 billion to $18.3 billion. The story North of the border shows a similar trend, with cannabis sales more than doubling from C$1.2 billion to C$2.6 billion.
And now, 2021 is proving that this surge in sales wasn’t just a way for shut-in consumers to cope with boredom.
Statics Canada reported that monthly cannabis sales reached a new record high, hitting $318.7 million in June. This is the third month in a row that retail cannabis sales have topped $300 million, and the numbers have been steadily climbing.
Ontario and BC are leading the pack in cannabis sales growth, with year-over-year increases of 170% and 70%, respectively.
And what are consumers buying? According to Hifyre IQ, pre-rolls and cannabis flowers make up roughly three-quarters of all cannabis purchases. However, the cannabis industry data analysis platform notes that they expect edibles, beverages and vapes to begin encroaching on that market share over the next year.
According to industry consultancy Brightfield Group, the Canadian cannabis market has reached a new maturity stage, which could have a dramatic shift in consumer preferences. In their most recent quarterly survey, they report four emerging trends in the cannabis sector:
In a somewhat surprising twist, the average age of retail cannabis purchases has climbed. Sales to the under 30 crowd have dropped from 33% to 25%. Additionally, the survey finds fewer “canna-curios” first-time users entering the market, indicating that the market may have plateaued. However, this decline was less apparent for edibles and ingestible like cannabis drinks than dried flower consumption.
The report also found that cannabis users are increasingly opting for higher THC levels. Additionally, those consuming higher potency cannabis products were also more likely to use cannabis daily.
With better distribution channels, and options such as home or mail delivery, Canadian cannabis users are gradually moving away from “informal dealers” to legal cannabis retailers. In Ontario, legal cannabis sales for the quarter were up over 13%.
In the cannabis drink market, US cannabis data analytic firm Headset recently reported that sales of cannabis-infused beverages were up 40% year-over-year. This growth was driven by consumer demand for more socially acceptable forms of cannabis consumption and those looking for an alternative to alcoholic beverages.
Global revenue from cannabis-infused beverages climbed to $250 million in 2020. And according to the latest report from research firm Fact.MR, the cannabis drinks sector is poised for takeoff.
Over the next decade, the firm predicts that the cannabis-infused beverage market will grow at a CARG of 38%, reaching $6 billion by 2031.
This growth is expected to be supported by newer users who prefer the discreet accessibility of cannabis-infused beverages over traditional means of consumption.
CBD-based beverages, the non-psychoactive cousin of cannabis, are anticipated to make up 3 out of 5 sales, while non-alcoholic cannabis options are projected to capture 50% of the market.
This signals an increasing shift towards alcoholic cannabis-infused beverages, which can partially be attributed to the growth of alcoholic brewing companies participating in the sector. Based on several consumer surveys, the preference for beer and spirits among cannabis users is expected to continue to climb.
BevCanna Enterprises Inc. (CSE:BEV, Q:BVNNF, FSE:7BC), an established natural health and wellness company with years of experience in creating and manufacturing iconic brands for in-house and white label clients, is now taking the cannabinoid market by storm.
The company behind the market-leading TRACE brand is leveraging its experience, world-class manufacturing facilities, and vast distribution network to make strategic moves into the flourishing cannabis beverage sector.
After signing an exclusive manufacturing deal with #1 US selling cannabis beverage brand Keef, BevCanna announced on August 9, 2021, that they had completed their first commercial production run of the cannabis beverage for distribution in select Canadian markets.
In a massive deal for the Company, BevCanna released details of multiple-product listings and initial purchase orders for Keef brands from the Ontario Cannabis Store (OCS) and the Alberta Gaming and Liquor Commission (AGLC).
The OCS is the only legal online cannabis retailer in Ontario, and Keef products will be available for purchase both in-store and through the OCS website.
AGLC is the Government of Alberta’s Crown commercial enterprise responsible for overseeing Alberta’s gaming, liquor, and cannabis industries. They also operate the only legal non-medicinal online cannabis store. Under terms of the deal, BevCanna will provide several Keef brand beverages as well as other white-label partner brands to over 600 licensed private retailers throughout the province.
Disclaimer: The company described in this article is a customer of NAI Interactive Ltd. This material is for informational purposes only and is not intended as a recommendation or offer or solicitation for the purchase or sale of any securities or financial instruments, or for transactions involving any financial instrument or trading strategy.