Hashish business needs modifications to rules limiting pot beverage gross sales

TORONTO – When cannabis beverages first hit the market in early 2020, industry players saw the products as a way to fuel ailing revenues and attract new consumers who might otherwise not buy cannabis products.

TORONTO – When cannabis beverages first hit the market in early 2020, industry players saw the products as a way to fuel ailing revenues and attract new consumers who might otherwise not buy cannabis products.

However, restrictive regulations prevent manufacturers from selling the drinks in the usual way and make it difficult to address potential consumers.

For example, alcohol drinkers are shocked to hear that many cannabis beverages cannot be bought in six-packs, according to President and CEO of the Cannabis Council of Canada, George Smitherman.

“They say, ‘What do you mean there is a limit? Nobody limits the number of bottles of tequila I buy. If I buy a lot, they even offer to help me get to the car,'” he said.

“Over here (with cannabis) we’re in a different world.”

Cannabis companies and advocacy groups are pushing Health Canada to change regulations that restrict sales of pot fortified beverages.

According to Sean Webster, Head of Government and Stakeholder Relations for Canada at Canopy Growth Corp., the problem lies in regulations restricting customers to no more than 30 grams of dried cannabis or its liquid equivalent (2.1 liters) per transaction.

Individual cannabis beverages sold in Canada may also contain no more than 10 mg of tetrahydrocannabinol (THC), the psychoactive component of cannabis.

This restricts buying more than five 355 ml cans of pot drinks containing 2 or 2.5 mg of THC each, but allows them to purchase nine Deep Space drinks from Canopy that come in 222 ml cans of 10 mg of THC are available, said Webster.

“It’s frustrating for consumers, and … honestly, for retailers because they’re the ones who got the rubber on the streets and they have to try to explain it to the consumer,” said Webster.

The Cannabis Council of Canada said the same restrictions allow buyers to purchase 17 cannabis vape cartridges with combined 5,950 mg of THC or 100 bottles of marijuana oil spray with 50,000 mg of THC in a single transaction.

“The reality is they got the formula wrong,” said Smitherman. “That is the most egregious and bizarre aspect of this formula.

He and others fear the formula could also pose a safety issue as it encourages companies to bring products to market with higher THC content but less volume or liquid.

Through recent consultations, Health Canada said it had heard that restrictions on the public possession of cannabis beverages “may be an inconvenience for consumers” and may inadvertently encourage some to purchase other products.

It is now actively looking at the contributions from these consultations, said spokesman André Gagnon in an email.

Canopy has recommended Health Canada increase the maximum possession limit to 48 units of cannabis beverages, regardless of the unit’s weight or volume.

Truss Beverage Co., a joint venture between Molson Coors Canada and licensed manufacturer Hexo Corp, is not seeking approval for a specific number of beverages for sale.

However, CEO Scott Cooper said, “Whether it’s 24 or 48, we think these fall well within the realm of responsible consumption and buying.”

Those calling on the government to reconsider its laws say current policies make it even more difficult for cannabis companies, which have faced significant headwinds in recent years.

Before and during the COVID-19 pandemic, many facilities closed, laid off hundreds of employees, and restructured as they got a clearer sense of the demand for cannabis in Canada and tried to use the revenue in To bring harmony.

As the health crisis began, the country’s first cannabis beverages hit the market, but stores in many provinces had to close temporarily to contain the virus. Cannabis companies had to encourage people to shop online or by pickup from the roadside.

“It’s been a very challenging business. It’s not for the faint of heart,” said Smitherman.

Cannabis drinks and edibles should provide some relief from the challenges, as industry watchers believed they would attract occasional, new, or unlikely cannabis users.

Cooper, Webster, and Smitherman are encouraging people to take part in a Cannabis Council of Canada campaign and asking the public to write to their federal MPs calling for “more sensible” regulations – and soon.

“Timing is of the essence,” said Smitherman. “There is an enormous potential for loss associated with this.”

This report by The Canadian Press was first published on September 6, 2021.

Companies in this story: (TSX: WEED, TSX: HEXO)

Tara Deschamps, the Canadian press