Canadian companies hoping to capitalize on the launch of new cannabis product categories later this year are building up inventories of marijuana oil – the key ingredient for those products – according to the latest data from Health Canada.
Finished inventory of cannabis oil reached almost 60,000 liters through February, more than double the 28,000 liters that companies stashed away in October.
Still, that’s a fraction of what will be needed to meet demand when the federal government enacts new regulations by Oct. 17 for the sale of cannabis extracts, topicals and edibles.
Finished inventory is defined as stock that is packaged, labeled and ready for sale.
GMP Securities analyst Martin Landry said the market for extracts would eventually account for half of all cannabis sales, with vape pens leading the way at 20% of the market, followed by edibles (15%) and beverages (10%).
Meanwhile, only about 5 million Canadian dollars ($4.2 million) of adult-use cannabis was sold in February, according to the data.
Sales of adult-use marijuana have been flat since Canada ended prohibition last October, mostly because of supply-chain issues and the slow rollout of physical storefronts.
Other highlights include:
- Sales of dried cannabis in February fell 8.8% on-month.
- Cannabis oil sales decreased 8.5% in the same period.
- The total inventory of dried cannabis that’s packaged and ready for sale reached 23,739 kilograms (52,336 pounds).
- Sales of medical cannabis were relatively flat in the month at about 1,700 kilograms.