Cannabis sales increase across US and Canada as lockdown continues. The population rushes to stockpile cannabis to prepare itself for the long period of self-isolation, due to the spread of the COVID-19 pandemic.
Between the time period of March 16 and March 22, key US markets, including California, Colorado, Oregon, and Alaska, experienced a 50 percent rise in sales of recreational cannabis, and a 41 percent rise in medical cannabis sales, from the same period last year, figures attained from cannabis point of sale and info system Flowhub exhibit.
With the death toll rising to 600 in both countries, several US states and Canadian provinces are issuing stay at home orders, limiting business operations, and closing down borders, in an attempt to actively work to combat the fast-spreading coronavirus.
Although many businesses have been shut down due to the orders of a lockdown, legalized cannabis dispensaries are allowed to continue their businesses despite the current crisis, and have been listed as “essential services” alongside hospitals and other health facilities, even in jurisdictions with the tightest lockdown protocols,
During the intensifying threat of the COVID-19 and increasing sales of cannabis across North America, Bank of America analyst Chris Carey commented that investors could be provided with a defensive move in a market downturn, by the cannabis sector. Carey further talked about the acceleration of cannabis purchases in North America, regardless of region.
Carey pointed out Aphria specifically, boosting its rating to a “buy”. According to the BNN Bloomberg, Carey had reportedly explained how the Ontario-based grower could be expected to see it’s market share in Canada increase.
Aphria and Tilray stocks rose during the same time period. Last week, Aphria’s shares had been reported to move from a low of US$1.97 (C$2.88) to hit US$2.72 (C$3.89), between the time period of March 18th to March 20th. Closing at US$2.51 (C$3.58) last week, they gained slightly more yesterday at US$2.54 (C$3.72) to end the day.
Meanwhile during March 19 to March 20, Tilry shares had risen twice as much, from a low US$2.56 to a high of US$5.03. Yesterday, the stock closed at US$3.85.
According to the OCS Director of Communications Daffyd Roderick, Canada’s most populated province, Ontario, the government-run Ontario Cannabis Store’s (OCS) website experienced escalating online sales in the last two weeks. Last weekend, orders were reported to be more than twice as high compared to two weeks ago.
On Sunday, Nova Scotia was reported to be the latest province to announce a COVID-19 emergency. The province’s liquor commission, that is responsible for the control of sales of cannabis in Nova Scotia, reported a spike of 76 percent in cannabis sales last week.
Sales were also booming in cannabis related beverage companies. One such case was reported by Jamie Pearson, CEO of California-based Bhang Inc, who makes and deals with cannabis-infused beverages, chocolates, and other products. Hence, Pearson is expecting boosted revenue and profits this quarter.
Pearson further claimed the most popular products to be edibles such as gummies, brownies, and chocolates, because of easier storage and accessibility even with precautions such as having gloves on.
Stuart Titus, CEO of California-based Medical Marijuana Inc informed Reuters that the reason behind the boost of Canadian sales was the fear of months of supply disruptions. However, caution is recommended by Titus and others, as they believe that the long-awaited reversal of fortune could potentially be nothing more than a short-lived relief.
Avis Bulbulyan, CEO of cannabis consulting firm Siva Enterprises, explained that even during a global crisis like the spread of the global pandemic, the cannabis industry seems to be recession-proof. Bulbulyan further added that the rise in customer demand is not expected to last very long during a time like this.