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Shortage of Marijuana, Justin Trudeau’s problem now

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Shortage of Marijuana, Justin Trudeau's problem now
Source: Notable.ca

As Canada is legalising recreational marijuana market in near future, Prime Minister, Justin Trudeau, is trying to overcome the shortage of pot in the country. Ontario’s Finance Minister, Charles Sousa, expressed concern over the same.

Canada is set to become the first major economy to legalise recreational pot activity in the next one year. In a meeting conducted this week, Sousa said a supply crunch was discussed with provincial and federal counterparts.

One of the analysts expressed concern that the government may use a supply shortage as an excuse to delay rolling out the program.

“Ultimately the biggest problem that appears after today’s discussion is one of supply,” Sousa said. He added that the demand for marijuana is ‘quite high’ in Canada.

“So we want to make certain that, when we do proceed, there is sufficient supply to accommodate the activity because what we’re trying to do is curb the illicit use and organised crime that now exists around it”, the Minister said.

Trudeau’s framework for legalisation began in April, which will rely on the country’s provinces to set up sale and distribution regimes.

According to Canaccord Genuity Group Inc., Canada’s marijuana industry mushroomed in value amid Trudeau’s plan for recreational sales. The company also said that the value could reach C$6 billion ($4.5 billion) annually by 2021.

Combined demand for recreational and medical marijuana may reach 575,000 kilograms by 2021, as per the report. As of March 31, Canada had 1,67,754 registered medicinal marijuana users.

The key aim of the government is to shrink or altogether kill the black market for marijuana. Trudeau’s plans also allow people to grow up to four plants in a home.

To ensure enough supply for the recreational markets, the existing companies are trying to expand their facilities.

The primary reason for the shortage is the expanding list of patients for marijuana.

Last month, Health Canada vowed to speed up its approval process for applicants seeking a license to grow marijuana.

While the government has issued a number of new licenses, it may still take several months or more for new companies to start production, said Beacon Securities analyst, Vahan Ajamian.

“The available supply hasn’t kept pace with the growth in medical marijuana patients and it’s unclear what type of products will be available in the legal market next year. Also, the level of taxation is uncertain”, he added.

Manitoba Finance Minister, Cameron Friesen, has expressed concern over the fact that it is too early to implement a legal market for recreational marijuana by July 2018.

However, Sousa said his government has no problem with the implementation date, which is likely to be sometime around the election next year.


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