Why Craft Cannabis Is Here To Stay
The increasing demand for craft cannabis is hardly surprising?
Welcome to Four PM — a daily newsletter that delivers cannabis industry analysis, interviews with industry leaders, and all of the latest news.
In Today’s Issue 💬
→ Why craft cannabis is here to stay.
→ The cannabis executives being charged.
→ Building awareness for cannabis beverages.
High Demand For Craft Cannabis
Is it really that surprising that craft cannabis is in high demand?
Last week, the CEO of Hexo said that “Craft has absolutely surprised us,” adding that it was “mostly a one-time thing.”
The increasing demand for craft cannabis shouldn't be a surprise given the demand for craft cannabis prior to legalization in addition to the rising demand for craft beer in recent years.
In the last decade alone, sales of craft beer have risen tenfold in Canada, and they now account for 6% of the Canadian market, and this number is estimated to be as high as 22% in the United States.
Surely this data could have been used to forecast consumer demand for craft cannabis ahead of time?
The term “craft cannabis” seems to have taken on many different meanings in recent times as many large cannabis producers who are by all accounts the exact opposite of craft cannabis producers sought to use this term as a means to drive demand for their mass-produced products.
With a recent wave of craft cannabis producers coming online, this term seems to be regaining its true meaning in light of consumers now having access to actual “craft cannabis products”.
I completely disagree with the comment made by the CEO of Hexo who suggested that this demand is a “one-time thing” as there will always be consumers who are willing to pay a premium.
Why would cannabis be the exception to this rule?
A Bad Look For Cannabis
5 former cannabis industry executives from two companies are charged.
In the past 7 days, 5 former employees of two cannabis companies have been charged.
In the case of CannaTrust — Peter Aceto (former CEO), Mark Litwin (former Director) & Eric Paul (former Chairman) have been charged with fraud, making misleading statements & a host of other offenses.
This follows the events that unfolded in 2019 when a whistleblower at CannaTrust brought light to the fact that the company was cultivating cannabis in rooms that had not received licenses from Health Canada.
With cannabis from CannaTrust having been shipped to patients overseas, this is a very bad look for the Canadian cannabis industry internationally.
In the case of Eaze, this story is simply a by-product of cannabis companies’ inability to access the existing financial system.
As a result, a Manhattan federal judge has sentenced two former consultants for Eaze Technologies Inc to prison on Friday last for their roles in a scheme to trick banks into handling more than $100 million in payments for Eaze.
No matter what regulations you put in place there will always be bad actors, and the fact that these issues have been caught and are being fixed should be viewed as a net positive for the cannabis industry in the long run.
As in the case of Eaze, there is no reason why any cannabis company should be in a position whereby they need to trick banks into working with them.
Cannabis now provides over 321,000 full-time jobs in the U.S and the time for cannabis companies to gain access to the financial system is well overdue.
Move Over Alcohol
Truss Beverages is seeking to increase awareness for cannabis beverages.
Cannabis beverage company Truss beverages have taken to the streets in an effort to increase awareness for cannabis beverages.
In Canada, some 78.5% of Canadians over the age of 18 are reported to have consumed alcohol last year, whereas this number is just 15% for cannabis.
Not every person will be open to smoking cannabis, and with the existing popularity of alcoholic beverages, it seems reasonable that cannabis beverages will continue to grow in popularity.
Long term many new consumers will seek alternatives to smoking cannabis, however, as the CEO of HERBL mentioned in last week's edition of Four PM “many dispensaries aren't equipped to deal with storing and displaying a beverage in their store right now.”
I personally see no reason why cannabis beverages can’t become more popular than alcoholic beverages in the coming decades as more & more consumers seek to embrace Cali Sober.
That’s it for today, have a fantastic rest of your day, and see you all tomorrow.
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