Cannabis short­ages likely to con­tinue into new year

The Packet (Clarenville) - - Editorial - BY ANDREA GUNN SALTWIRE NET­WORK

Health Canada says le­gal cannabis short­ages that have been ex­pe­ri­enced in some provinces, in­clud­ing in At­lantic Canada, will likely con­tinue into the new year.

Karen Casey, Nova Sco­tia’s fi­nance min­is­ter and deputy premier, said re­cently, the province is only re­ceiv­ing 35 to 40 per cent of the cannabis it needs to meet the de­mands of con­sumers, lead­ing to store clo­sures in some cases and rais­ing con­cerns about con­tin­ued re­liance on the black mar­ket.

Other provinces have been fac­ing sim­i­lar is­sues, Casey said, and have ap­proached Health Canada with their con­cerns.

In an email, Health Canada spokesper­son Tammy Jar­beau con­firmed the depart­ment has ob­served lo­cal­ized short­ages of sup­ply in some mar­kets and in some prod­uct lines.

Those short­ages were ex­pected, Jar­beau said, and will likely con­tinue in the months ahead, as pro­duc­ers of cannabis and provin­cial and ter­ri­to­rial distrib­u­tors and re­tail­ers aim to match pro­duc­tion and ship­ment lev­els to mar­ket de­mand.

“It is im­por­tant to note that Oct. 17 marked the end of nearly a cen­tury of crim­i­nal pro­hi­bi­tion of cannabis and the launch of an en­tirely new reg­u­lated in­dus­try in our coun­try. As with any new in­dus­try where there is con­sid­er­able con­sumer de­mand, we ex­pect there may be pe­ri­ods where in­ven­to­ries of some prod­ucts run low or, in some cases, run out,” Jar­beau said. “As the ex­pe­ri­ence from U.S. states that have reg­u­lated ac­cess to cannabis has demon­strated, dis­plac­ing the il­le­gal mar­ket for cannabis will take time.”

Jar­beau also noted that given the long-stand­ing il­le­gal sta­tus of cannabis, there were no es­tab­lished bench­marks to de­ter­mine which prod­ucts would be in high de­mand and which would not, or to pre­cisely es­ti­mate de­mand lev­els.

How­ever, based on avail­able data, Jar­beau said there is more than enough dried cannabis and cannabis oils to meet Cana­dian le­gal de­mand in the mar­ket­place, but the chal­lenge will con­tinue to be for li­censed pro­ces­sors to work with distrib­u­tors and re­tail­ers to process, pack­age ex­ist­ing in­ven­tory and ship fi­nal prod­ucts to meet con­sumer de­mand.

Jar­beau’s email also noted that sup­ply ar­range­ments are ne­go­ti­ated di­rectly between fed­er­ally li­censed pro­duc­ers/ distrib­u­tors and re­tail­ers au­tho­rized by provinces and ter­ri­to­ries.

As the over­all sup­ply chain gains ex­pe­ri­ence mar­ket­place and li­censed pro­duc­ers con­tinue to ex­pand their pro­duc­tion, Jar­beau said it is ex­pected lo­cal­ized and prod­uct-spe­cific short­ages will be­come far fewer in num­ber and over­all lev­els of sup­ply will con­tinue to grow month over month.

Ac­cord­ing to Health Canada, there are cur­rently 134 com­pa­nies li­censed to pro­duce cannabis in Canada — 90 of those were li­censed in the last 16 months — and 60 with a li­cence for sales. Since May 2017, li­censed square footage has in­creased from two mil­lion square feet to more than 14 mil­lion square feet.

Re­cently, a Lower Sackville, N.S.-based com­pany, At­lantiCann Med­i­cal Inc., re­ceived its cul­ti­va­tion li­cence. It op­er­ates a new 48,000-square-foot cul­ti­va­tion and ex­trac­tion fa­cil­ity with a pro­duc­tion ca­pac­ity of 6,000 kilo­grams per year.

Chris­tine Halef, pres­i­dent of At­lantiCann, said the road to get­ting a li­cence has been lengthy.

Once the com­pany re­ceived a green light in the form of a readi­ness let­ter from Health Canada back in the spring of 2017 fol­low­ing ex­ten­sive se­cu­rity and back­ground checks, Halef said they then had to pro­vide what’s called an ev­i­dence pack­age to Health Canada af­ter their fa­cil­ity was built. That was sent off in Oc­to­ber of this year.

“(That ev­i­dence pack­age) is videos and pic­tures and re­ports in­di­cat­ing that what you were go­ing to build in your ap­pli­ca­tion is ex­actly what you built,” she said. “All of our se­cu­rity footage and our se­cu­rity sys­tem ... the way we built our fa­cil­ity — ev­ery as­pect of our fa­cil­ity was as­sessed.

“It’s been a long process, but it’s just the way the process is. I mean, you have to go through all of your re­quire­ments and build­ing a fa­cil­ity of this type is also not a fast process, so that con­trib­utes to the length of time in this whole sce­nario.”

Once a cannabis pro­ducer is li­censed for cul­ti­va­tion and pro­cess­ing there is an ad­di­tional process to get a re­tail li­cence that per­mits the sale of their prod­uct in stores.

Part of that in­volves grow­ing at least two har­vests — Halef said that typ­i­cally takes about three months each — which have to pass Health Canada’s qual­ity con­trol.

Health Canada will also come for a site au­dit and en­sure the com­pany is fol­low­ing all reg­u­la­tions and op­er­at­ing pro­ce­dures.

“Once you’re past all that and Health Canada is­sues a sales li­cence, at that point that we can sell both medic­i­nally through pa­tients and recre­ation­ally through (re­tail­ers).”

ERIC WYNNE/SALTWIRE NET­WORK

At­lantiCann pres­i­dent Chris­tine Halef is shown in one of her com­pany’s grow rooms, lo­cated in the Lower Sackville busi­ness park. At­lantiCann just re­ceived fed­eral ap­proval to pro­vide cannabis to Cana­dian con­sumers.

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