More Canadians are continuing to purchase cannabis through regulated legal channels. From October to December 2021, Canadians purchased $1.22 billion of non-medical cannabis from licensed sources, according to new Statistics Canada data. This is an increase of 4.8% from Q3 2021 and an increase of 33% from the same time frame in 2020.
Illicit cannabis spending dropped to $660 million from October to December 2021, compared to $690 million in Q3 2021. This is a decrease of 4.3% from Q3 2021 and a drop of 13.5% from the same time frame in 2020. Illicit cannabis now makes up 33.1% of the total Canadian cannabis market.
However, there is still work to be done to alleviate the illicit market. Levon Kostanyan, owner of Lagoo Cannabis Shop in downtown Toronto says, “The City of Toronto isn’t capable of closing the illegal stores, which is an issue for legal stores. It has already been four years since legalization, and simple things like this still aren’t resolved in Toronto.” Lagoo faces competition from an illicit store that operates next door and the city has been working for years to shut down that chain of illegal stores.
Medical Spending Declining
Spending on cannabis products for medical use also continues to drop, with $109 million in sales in October to December 2021, compared to $125 million during the same time frame in 2020. Medical cannabis now makes up only 5.4% of the total Canadian cannabis market.
Total expenditures on cannabis were $1.99 billion for the quarter, or $21.7 million per day.
It wasn’t until the third quarter of 2020 that licensed retailers had managed to overcome the illicit market. But with each passing month, more Canadians are participating in the legal cannabis industry rather than its unlicensed counterpart as more stores open across the country. There are now more than 3,000 licensed cannabis stores servicing the Canadian market.
The shift in spending can be attributed to a number of factors, including awareness, the growing number of licensed cannabis retail stores, dropping prices, and online delivery options.
Photo courtesy of piggybank.ca.