Lasting high? Cannabis industry aims to build on Thanksgiving rush

Medical Marijuana

04/12/2020 16:17

By Shariq Khan
    Dec 4 (Reuters) - U.S. cannabis sales hit record levels over
the Thanksgiving weekend, prompting industry predictions the
combination of COVID-19 anxiety and a trend towards legalisation
has triggered a permanent uplift in demand.
    After years of sluggish official sales, buying soared in
early March and April when lockdowns began and consumers,
fearing supply disruptions, stockpiled the drug.
    Though many expected the initial surge to fade, monthly
sales have kept hitting records.
    One of the top cannabis data aggregator and research
companies Akerna  KERN.O  said sales on Green Wednesday, as the
eve of Thanksgiving is known, climbed by 80% above the daily
average this year, hitting an all-time one-day record.
    The company's calculations, based on data collected from its
partner dispensaries in 19 U.S. states and adjusted to project
the full market, show total cannabis sales of around $238
million during the Thanksgiving weekend, nearly 14% above last
year.
    By keeping people at home, limiting their entertainment
options and adding to stress, the pandemic has helped to drive
demand for cannabis for much of the year.
    Four in 10 users increased their overall consumption and
more than half said they turned to cannabis to improve mental
health, an advance copy of a report by research firm New
Frontier Data, which is to be published next week, showed.
    
    'COME TO JESUS' MOMENT
    Even if COVID-19 vaccines can bring back a degree of
normality, insiders and observers say 2020 is likely to mark a
watershed for the cannabis industry, as for many other sectors.
    "The shutdowns created a real 'come to Jesus' moment for a
lot of stakeholders," Avis Bulbulyan, Chief Executive of
cannabis consultancy Siva Enterprises, said. "Consumer
acceptance went through the roof."
    As a result, operators upgraded their plans and attracted
mainstream investors that before showed little interest in the
nascent industry.
    Further legitimacy came from the decision of state
regulators to designate cannabis retailers as "essential
business" during lockdowns, and, in the U.S. elections on Nov.
3, initiatives to legalise recreational or medical marijuana,
which five states put on the ballot, sailed through.
     
    
    Thirty-five states allow medical marijuana use, some with
restrictions, and 15 states, plus the District of Columbia, have
legalised its recreational use. 
    Opposition persists, however, with some groups saying it
causes addiction and that not enough research has been carried
out to prove medical benefits.
    The states of Idaho and Nebraska have bans in force.
Activists in favour of cannabis are seeking a vote to try to
overturn them in 2022 mid-term elections.
    Stuart Titus, an early cannabis investor and CEO of Medical
Marijuana Inc  MJNA.PK , says 2021 could be the year when
cannabis becomes as readily available as alcohol and tobacco.
    "Shortly in restaurants, consumers will have the choice of
an alcoholic beverage or a cannabis-based beverage," he said.
         
    
    For an interactive graphic on states that have legalized
marijuana in the United States, click here https://tmsnrt.rs/3lGcCtU.
    
    FEDERAL VERSUS STATE
    Marijuana remains illegal under federal law, which has
limited the industry's access to banking services and funding. 
    Vice President-elect Kamala Harris' has promised to change
that and decriminalising weed is part of the Democrats'
platform.
    Industry insiders acknowledge it may take years for any
changes to make their way through the legislative process, but
shifts in sentiment are moving more quickly.
    A Gallup poll in November showed support for marijuana
legalisation had reached 68% support, the highest level yet and
up from 66% last year.
    At the same time, a separate Gallup poll found 70% of U.S.
adults consider smoking marijuana to be "morally acceptable," a
5 point rise in a year.
    Solid majorities for legalisation in traditionally 
conservative states, such as North and South Dakota or Missouri,
could also help to win over Republican lawmakers and local
politicians, Steve Allen, chief executive of Californian
producer The Parent Company, said.
    "With many Republican Senators now representing states that
have passed cannabis legalisation measures by wide margins, we
will likely see increased support from Republicans for federal
cannabis reforms," he said.
    Akerna CEO Jessica Billingsley said her company has received
a record number of research requests from state governments,
which have lost tax revenues to business closures during the
pandemic and are looking for new sources of income.
    "Lawmakers see cannabis legalisation as a great way to shore
up their balance sheets and provide jobs during this time of
economic uncertainty," she told Reuters.
    The experience in Canada could yet serve as a cautionary
tale. 
    It became the first major nation to legalise recreational
weed in 2018, but industry hopes were dashed by oversupply,
black markets and lack of profitability.
    Producers and research firms say the United States is better
placed to succeed because of the vast size of the potential
market, new products and greater awareness of the therapeutic
benefits of cannabis.
    "What used to be a 'recreational drug' is being better
understood to be a complex compound with a long list of
potential benefits for both the mind and body," The Parent
Company's Allan said.

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Big Wins for Marijuana Ballots    https://tmsnrt.rs/33Iz8My
Marijuana Legalization by State    https://tmsnrt.rs/3mDDGeM
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 (Reporting by Shariq Khan in Bengaluru;
Editing by Tomasz Janowski and Barbara Lewis)
 ((Shariq.Khan@thomsonreuters.com; Within U.S.+1 646 223 8780,
outside U.S. +91 80 6182 2681; Twitter: @shariqrtrs))