HIGHLIGHTS
- Canadian retail cannabis sales jump more than $11 million in May from April
- Ontario retail cannabis sales up 16 per cent in May vs April, Alberta up 10 per cent
- Ontario, Alberta and Quebec sell two-thirds of Canada’s retail pot in May
Retail cannabis sales in Canada jumped above $85 million in May, up 15 per cent from April as more stores opened in the country’s biggest consumer market Ontario while increased purchases in Quebec were also a key factor, the most recent Statistics Canada data show.
This marked the third straight month of double-digit growth for the country’s newest industry, with May sales up more than $11 million from April, as legal growers increased their production to meet consumer demand. Every province saw increased sales, with Ontario at the top at $22.8 million in May, up 16 per cent from April, followed by Alberta at $17.5 million, which was up 10 per cent month-over-month.
Statistics Canada pegged Quebec’s recreational pot sales at $17.1 million, up 26 per cent from April.
These three provinces made up roughly two-thirds of Canada’s legal recreational cannabis sales in May, calculations show.
Sales are expected to have risen further in June and July after Alberta’s retail cannabis regulator lifted its licence moratorium due to improved supplies from licensed producers (LPs). Since the end of May, Alberta Gaming, Liquor and Cannabis (AGLC) has granted 95 retail licences, nearly doubling the province’s tally to around 200.
While newly licensed stores are now opening at a frenzied pace in Alberta, retailers say recreational pot supplies are more abundant than ever, leading to expectations for a surge in sales in the western province.
Alberta has by far the largest amount of legal pot stores in the country, though numbers are ramping up across the country as LPs increase production, which has so far been sharply lower than demand amid a nation-wide shortage.
Canada is widely expected to see a surplus of legal weed by 2020, though illegal purchases still account for the majority of pot sales.
Earlier this month, the Alcohol and Gaming Commission of Ontario (AGCO) set the stage for the number of licensed stores there by triple to 75 by the end of 2019, with 42 licences to be granted via the province’s second lottery scheduled for August, with an additional eight set aside for First Nations reserves. For now, just over 20 legal pot shops are open in Ontario.
Some, however, question Statistics Canada’s large sales estimate for Quebec.
“I am a bit suspicious of the big estimated increase in Quebec, as Statcan's previous estimates for that province haven't been very accurate when checked against the SQDC's (Société québécoise du cannabis) own quarterly reports,” said Michael Armstrong, associate professor in the Goodman School of Business at Brock University.
“The department underestimated that province’s sales by 17 per cent in 2018′s fourth quarter and overestimated them by 17 per cent in 2019′s first quarter.”
