• 10 hours The Fed Is Printing Money At Unprecedented Levels
  • 11 hours How Is The Real Estate Market Handling COVID-19?
  • 12 hours Gold Flat As Markets Await Fed Chair Speech
  • 13 hours What Is Day Trading And Is It Right For You?
  • 14 hours Energy CEOs See Big Payouts Despite Oil Price Crash
  • 15 hours Saudi Arabia Is Fighting A War On Two Fronts
  • 16 hours 40 Million Jobless As Pandemic Fuels Economic Collapse
  • 17 hours What Do India's Latest Reforms Mean For Its Coal Industry?
  • 18 hours Copper Glut Continues To Grow
  • 1 day How A Pandemic Made Americans Better Workers
  • 2 days The Trillion Dollar Space Race Crosses Another Milestone
  • 2 days Gold Prices Fall As Stock Market Sentiment Turns Positive
  • 2 days Conspiracy Theories Set Tone For 5G Cold War
  • 2 days Working From Home Will Transform The Energy Industry
  • 2 days The Multi-Billion Dollar Race For A Vaccine
  • 2 days Can Domestic Tourism Bolster Emerging Economies?
  • 3 days Australia Considers $100 Million Investment To Kickstart Mining Industry
  • 3 days Has Re-Opening The Economy Been Successful?
  • 3 days Gold Miners Still Have Massive Upside Potential
  • 3 days The Risky World Of Oil Hedging
EU Defies U.S., Sets Up New Iran Payment Channel

EU Defies U.S., Sets Up New Iran Payment Channel

While there’s no guarantee that…

Brexit’s $34 Trillion Problem

Brexit’s $34 Trillion Problem

With the countdown to Brexit…

  1. Home
  2. Markets
  3. Regulation

Ontario Moves To Slow Cannabis Drive

MJ

Canada legalized recreational use of marijuana in June, with retail sales slated to launch in October, but there’s a new conservative provincial government in Ontario that’s hoping to slow things down with a 6-month delay.  

On Monday, the provincial government on Ontario said that retail sales in the province would be delayed until April 1, 2019, and that the government—as previously planned—wouldn’t be running its own, brick-and-mortar weed stores.

So, when October comes around, it won’t be a retail free-for-all: The only wait to buy cannabis for recreational use then will be from the government, online. Private retailers can’t jump on board until next April.

Recreational marijuana use become legal on October 17, with residents of the province who are 19 and older allowed to buy weed from the Ontario Cannabis Store website.

The newly elected conservative government’s Liberal predecessors were planning 150 brick-and-mortar cannabis stores by 2020. The stores were meant to pave the way for the private retail system to work itself out.

But Ontario Premier Doug Ford has other plans, even though his province has enjoyed the monopoly on weed. But in the bigger Canadian pot picture, Ontario is the big prize: It’s the wholesale distributor for private retailers.

“We have to get this right and we will not be rushed. We will use this time to consult with businesses, consumer groups, public health organizations, municipalities, law enforcement and indigenous communities,” Ford told reporters.

“The government of Ontario will not be in the business of running physical cannabis stores,” Finance Minister Vic Fedeli told a news conference Monday Related: Investors Flee Emerging Markets Amid Lira Crisis

“Instead, we will work with private sector businesses to build a safe, reliable retail system that will divert sales away from the illegal market.”

Attorney General Caroline Mulroney said private stores will be “tightly regulated.”

That said, each municipality in the province has the choice to opt-out of physical cannabis stores, and the provincial government will be doling out $40 million to help local governments deal with the costs of legalization.

Ontario’s new plans will disappoint prospective retailers who have been flocking to the province ahead of legalization, trying to shore up a market position before the floodgates are opened. But the disappointment will be short-lived. The delay may hold private retailers back six months, but when April hits, the fact that there won’t be any physical government stores means more opportunity for the private sector.

In other words, the government of Ontario has just relinquished the throne here and is giving up its monopoly on weed to the private sector. Investor radar should be pinging, and six months gives everyone time to secure market share now that the rules of the game have been revealed.

In the meantime, darling Canopy Growth (CGC) was down over 7 percent today, ahead of earnings results expected at the close of the market.

(Click to enlarge)

By David Craggen for Safehaven.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment