Cannabis Sales Decline in September
Math, Not Gloom and Doom, the Cause in Most Cases – LPC
The consumer market saw legal cannabis sales decline in September, with recreational cannabis sales down 2.4 per cent from August. The legal market sold approximately $123 million, down from $126 million in August. However, not all analysts saw it as a “gloom and doom” story. Chris Damas of The BCMI Report indicated that for the most part it came down to math.
“Part of the September sales drop was due to the 30-day month compared to August’s 31-day month,” he wrote. “Most cannabis stores are open seven days a week.”
“The other aspect could be a ‘back to school’ phenomenon,” he added. Cannabis sales decline – along with many other recreational activities – after summer comes to a close.
That may be true for many provinces. In Ontario, the legal cannabis sales decline was six per cent decline while sales increased in Quebec by 4.7 per cent.
New Brunswick Cannabis Sales Decline 40% – LPC
By far the largest cannabis sales decline was in New Brunswick at 40 per cent. The government-run Cannabis NB recently announced it was looking for a private owner to take over. Once hoped to be a source of revenue for the province, it instead lost $12 million in the first six months.
“This was the best way to stop losing money at this point,” Ernie Steeves, Minister of Finance and Treasury Board, told CTV. “We are responsible for the taxpayers’ money, and we have to be prudent with it.”
Cannabis sales decline is not good news for the industry, regardless of the cause. Several LPs reported disappointing cannabis sales in their quarterly reports. Many blamed the Ford government in Ontario for not opening stores fast enough. There are indications that the provincial OSC wholesale model is changing, and that cannabis retail roadblocks may come down in the near future.
In a recent interview, Bruce Linton indicated that the future of cannabis won’t be only cannabis. He plans to diversify looking at hemp, CBD, and international medical. Aurora Cannabis was found to be dumping cannabis and recently announced it halted construction of two new grow facilities, which seems to support the cannabis sales decline argument.
It’s not likely that legal cannabis sales have bottomed out though. If Ontario can open its markets and jurisdictions can continue to crack down on black market cannabis, things can turn around. The soon-to-be-launched cannabis edibles market may help as well.
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