Cannabis edibles in high demand but not quite a jackpot

Cannabis customers are gobbling up the new edible products introduced this week in Ontario’s legal pot shops.

Stores are selling out of the pot-laced gummies, cookies and chocolates — as well as new vape and tea products — as soon as they hit the shelves, several proprietors say.

“They are going very, very quickly,” says Lana Paraskevopoulos, general manager of the Canvas Cannabis shop on Danforth Ave. “We can’t keep the edibles in stock.”

The same holds true across town, where the so-called cannabis 2.0 products — which will grow to include topical lotions and alcohol-replacement beverages — are flying off the shelves at the Hunny Pot Cannabis Co. on Queen St. W.

Alcohol alternatives on offer will include such things as THC-infused sparkling-water drinks, coolers and cannabis-laced cocktail bases.

“We’re seeing products selling out,” says Cameron Brown, a spokesperson for the shop, the first to open in the city in October 2018.

“We saw the soft chews, the cookies and even the tea bags and chocolates all move out extremely quickly. They were sold out in a day or two,” Brown says, adding that the new vape products were popular too.

The Ontario Cannabis Store’s website saw brisk sales as well, with 2,000 transactions processed on Thursday an hour after 70 products — cannabis-infused chocolates, cookies, soft chews, mints, tea and vapes — were made available at 9 a.m. local time.

Some products sold out within a half-hour, said the cannabis distributor’s spokesperson Daffyd Roderick.

Paraskevopoulos says many customers rushing to buy the new products are first-time users who eschewed the combustible counterparts, which have been legally available since October 2018.

“The edibles obviously are the heavy favourite because they are a great product for consumers who don’t like combustible cannabis or smoking in any fashion,” she says.

She also says many customers are simply keen to try something new.

“It’s a great entryway into cannabis consumption for people who are unfamiliar,” Paraskevopoulos says.

Canvas Cannabis owner Helene Vassos told the Star she expects the 2.0 products to bring the cannabis curious into the store.

Aside from their smoke-free and novelty attractions, however, a big reason stores can’t keep the products in stock is a supply shortage from licensed producers.

The vast majority of edibles contain active cannabis components like the psychoactive THC and medicinal CBD that have been extracted from the plant and purified.

As with the introduction of dried flower and oil products in 2018, there’s a severe scarcity of 2.0 offerings off the mark, says Michael Armstrong, a cannabis expert at St. Catharines’ Brock University.

But, Armstrong says, current 2.0 shortages were predictable and are due in large part to the federal government’s rules surrounding their rollout.

“On the one hand, yes, they (the producers) had lots of time to think about things and design things,” Armstrong says.

“But it was the procedures the federal government put in place (that ensured low initial supplies).”

In particular, Armstrong says, producers were only allowed to submit the new 2.0 products for Health Canada approval on Oct. 17 of last year and a mandatory, 60-day review process followed for each one.

No producer was going to go ahead with a full production run before that approval was granted, he says.

“That meant December 17 was the first time they (the producers) would actually want to push the production switch and say ‘go,’ ” Armstrong says.

“If Health Canada said, ‘That looks a little too much like it would appeal to kids or we don’t think you’ve done the packaging or labelling quite right,’ that would be a big risk to take.”

Both experts and vendors have little idea what percentage of the cannabis market the new products will claim when they approach full production over the coming year.

“With the serious limit on the quantities available it’s really, really hard for me to extrapolate what our percentage of sales would be,” Paraskevopoulos says.

Ontario Cannabis Store spokesperson Daffyd Roderick says U.S. states that have legalized cannabis in past years have had varying experiences when it comes to the sale of edible products.

“There’s definitely lots of interest, but we won’t really know how much that interest translates into sales until they get more supplies into the stores,” Armstrong adds.

In a report last year based on an online survey of 2,000 adults, Deloitte estimated the annual Canadian market for edibles and alternative cannabis products at $2.7 billion, with edibles accounting for $1.6 billion. Statistics Canada reported that Canadians spent about $908 million on nonmedicinal cannabis in the first 12 months of legalization.

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Statistics Canada data shows that some 76 per cent of current cannabis users report smoking dried flower, while about 26 per cent use edibles and some 19 per cent use vape products. Many survey respondents reported using a combination of products.

“But the catch is there are a lot of people thinking that these products will actually attract new users,” Armstrong says.

“There’s a lot of expectation that people who would never consider smoking a joint would consider saying, ‘Oh, a cookie, I wouldn’t mind trying that.’ ”

As well, Armstrong says the alcohol alternatives that most stores have yet to see are a wild card in the 2.0 sales equation as they’ve yet to be fully tested in any other market.

While some drinkable pot products like teas have been available on the black market, he says no illicit players had the industrial capacity to produce the alcohol alternatives that are currently in the pipeline here.

“Those (drinkable products) have got new technology that the black market does not have (and) that the Americans do have but haven’t really rolled out in large quantities,” Armstrong says.

“The producers of those beverages are hoping that those are going to attract existing alcohol drinkers ... but it’s a big question mark because nobody has done this before.”

Brown says his store was able to offer some 80 of the new 2.0 new products so far and that — when available — they represented about 20 per cent of his daily sales.

And he says that many of his early customers were indeed new cannabis users.

“We had people coming in saying we’re only here for 2.0 products,” Brown says. “We have a lot of new customers ... finally able to come in and purchase a product they were waiting for.”

The online Ontario Cannabis Store introduced its 2.0 lineup Thursday, with dozens of new products available.

Roderick said some products sold out within 30 minutes.

“However it comes with the same caveat that supplies will be initially fairly limited and variety will be limited,” Roderick says. “But this is a new venture for this sector and we’re going to see it grow slowly over time.”

Roderick says the new products will give the legal market a far greater ability to combat its still robust illicit counterpart.

“What we do know through our research is these products sell quite well through the illegal online marketplaces places that are available,” he says. “So we feel they are going to be an invaluable part in our ability to take on the illegal market.”

Roderick also says the Health Canada certification each legal offering bears also gives the legal market a leg up — especially in the vape sector, where severe health problems and deaths have been linked to illicit products.

Health Canada also says its 10-mg limit of THC for any one product (one “package” could contain five chocolates at 2 mg each, for example) will help stave off the panic trips new users can sometimes experience with black-market edibles — which can contain far higher levels of that psychoactive cannabis component.

Brown says he expects to see about 30 new products a week coming into his store over the coming months.

But combined, he says, they are unlikely to knock traditional dried cannabis flower products — the stuff from which joints are rolled — from their high perch.

“I believe flower will always be king,” Brown says.

With a file from The Canadian Press

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