Over one year since legalization of recreational marijuana in Canada, the industry is growing fast. During the one-year anniversary, Cannabis 2.0 went live, expanding the product range available to users. While Canada is making the huge strides, the US is still dragging its feet. Is it possible for cannabis companies to operate optimally across the region? Well, it depends.
Cannabis 2.0 in Canada, progress in the US
On recreational cannabis legalization in October 2018, the law allowed a narrow range of products. In particular, the Cannabis Act only allowed cannabis oil and dried cannabis. In October 2019, a new legislation made it possible for producers to supply cannabis derivatives. These include topicals, edibles, concentrates, and vapes. Dubbed Cannabis 2.0, the second round of legalization opened up more space for existing licensed producers to expand revenue streams. In addition, the legalization is an opportunity for new companies to enter the scene.
According to insights by Deloitte, Cannabis 2.0 nurtures new growth in an industry that is barely on its feet. The new class of cannabis products is not only an opportunity for LPs to broaden their product range. Instead, it attracts a new category of users who would not smoke dried cannabis. Now, users have an opportunity to use cannabis without facing the risk of smoke damage.
Canada might be grabbing all the headlines as far as cannabis is concerned but something is happening in the US. The US lacks a common legislation across all the states, but there are positive steps in motion. On September 26, 2019, the US House of Representatives passed the SAFE Banking Act. If enacted, the Act will allow cannabis companies in the US to use the banking services without the existing restrictions. Chemistree Technology Inc. (OTCMKTS: CHMJF) welcomed the developments terming them “a huge vote of confidence” for the cannabis industry.
Chemistry wants a piece of Canada and the US cannabis industry
Since its inception, the Vancouver-based Chemistry has been explicit about exploiting the potential of the North American cannabis industry. The company showed interest in the US long ago, ahead of other major players like Canopy Growth. Interestingly, Canopy Growth might be the largest cannabis company in the world but its first foray into the US began just this month.
Chemistree has assets in strategic cannabis markets like California and Washington. Additionally, Chemistree announced the acquisition of new assets in New Jersey this July. The company invested in Applied Cannabis Sciences of New Jersey, a business focused on production and supply of medical marijuana in the state. This year alone, the company has completed acquisitions in Arizona, Washington State, and California. Particularly, Chemistree intends to exploit the legal status of hemp in the US to produce cannabis-related products.
Generally, the cannabis industry in Canada is growing at a steady pace. The industry has struggled with issues like shortage of cannabis but suppliers are stepping up their game. For Chemistree, it is all about balancing the opportunities in the US and Canada. In particular, the increased investment in the US market is strategic in that the company will have a comfortable head start when the legal status of recreational cannabis is recognized on a federal level.
