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Cannabis affecting Beer Sales in MB

On March 4, the Manitoba government released their third quarter economic update for the 2018-19 fiscal year. While cannabis and liquor are not included in the report, Finance Minister Scott Fielding told reporters that day: “When cannabis is introduced to a marketplace, what actually happens is beer sales go down. We anticipate that our beer sales are going to go down by upwards of $6 million dollars.”

He also said the province predicts no net revenue from the sale of recreational cannabis, as expenditures related to legal cannabis will outpace revenue from its sales for several years. Fielding’s claims were quickly met with criticism by the opposition.

Manitoba Liquor and Lotteries 2018-19 Corporate Business Plan forecasts an increase in annual revenue from $1,424,128 in 2017-18 to $1,469,459 in 2018-19 but states cannabis sales haven’t been taken into account. The report also references the impact of cannabis legalization on the US alcohol market, citing a 1-15% reduction in overall alcohol sales.

In the latest Statistics Canada report showing province-by-province cannabis sales numbers from October to December 2018, Manitoba had the fifth highest sales in Canada, falling behind Alberta, Quebec, Ontario, and Nova Scotia.

There continues to be much uncertainty about the impact of cannabis on alcohol sales. Government is expected to release the provincial budget on March 7, but it is unclear if cannabis revenue projections will be included.

Photo courtesy of Petr Sonnenschein.