![]() Some are warning that the race to expand supply could have other consequences. “But I think it’ll take some time for the market to pick up as well,” he added. Louis said that the group would ultimately be able to meet supply, “whether that’s 24, 36 months down the line.” Louis said, basing his projection on a $20-billion annual market for weed. “When that group represents about 70 per cent of the production in Canada of medical marijuana, and when you look at those, at all the expansion plans from those members, including Hydropothecary, that represents about 25 per cent of the estimated future demand for marijuana,” St. Louis, who also serves as a director of the Cannabis Canada Association, which represents most of the licensed medical producers in the country, said their construction plans aren’t likely to meet the initial demand. Sébastien St-Louis, chief executive of Quebec-based Hydropothecary Corp., said his company has “aggressive expansion plans underway.” The company announced Thursday it had broken ground on a 250,000-square-foot, $25-million greenhouse expansion that will now allow it to churn out 25,000 kilograms of dried cannabis a year. “However, though a number of these developments are well underway or are in the final design phase, it can take two years for new facilities to be fully operational, so the majority of this new capacity will not come online until late 2018 or 2019,” McLeish noted, adding that “growing this amount of cannabis is unprecedented, and we believe that licensed producers will likely experience production challenges when they scale up their facilities.” Funded expansion plans will bring total production capacity up to about 720,000 kilograms, he wrote. McLeish found that more than $1 billion has been raised by marijuana businesses since the start of 2014, with most of those funds going towards the construction of new facilities or the expansion of existing ones. More such deals are expected, and as provinces line up to ink supply contracts, producers have found themselves in a race to expand their capacity. This advertisement has not loaded yet, but your article continues below. “These numbers are contingent on getting enough supply from federal licensed producers,” Charles Sousa said last month, when announcing the program. The firm doesn’t foresee supply meeting demand until late 2020, McLeish said.Įven the finance minister of Ontario wasn’t sure of successfully stocking the province’s proposed e-commerce channel and approximately 80 retail outlets they expect to have ready in the first year of legalization, which is still slated to begin by July 2018. ![]() ![]() This “will not nearly be enough to fulfill near-term demand,” analyst Greg McLeish wrote in a Sept. Mackie Research Capital, for example, recently pegged total demand for marijuana in 2018 at approximately 795,000 kilograms - but forecast that licensed producers will end 2017 with production capacity of a little over 100,000 kilograms annually. Article content Customers line up at the NuLeaf marijuana dispensary in Las Vegas.
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