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Drinks firms enter Canada’s new legal cannabis market

Canada has today become the second nation to legalise recreational cannabis use, paving the way for a number of drinks firms to become active in the burgeoning market.

Recreational cannabis use is now legal in Canada

The country passed the Cannabis Act in June this year, making it legal to consume cannabis recreationally from 17 October 2018.

While a number of nations and states have moved to decriminalise cannabis, Uruguay is the only other country to have fully legalised recreational use at a national level.

Over the past year, players in the alcohol industry have planned moves into the cannabis sector amid concerns over market share.

In October 2017, US drinks firm Constellation Brands acquired a minority stake in Canopy Growth Corporation for US$191 million, announcing its intention to create cannabis-infused drinks. The group upped its investment by US$4 billion in August.

‘Edible’ cannabis products and concentrates will be legal for sale “approximately one year after the Cannabis Act has come into force and federal regulations for their production have been developed and brought into force”, according to the Canadian government.

A recent report claimed that sales of cannabis-based food and drinks in North America could hit US$4bn by 2022.

Leading drinks sales firms are also seeking to capitalise on the potential of the market. Southern Glazer’s, the largest wine and spirits distribution group in North America, created a subsidiary exclusively for the representation of Aphria’s cannabis products in Canada.

Meanwhile, fellow distributor Breakthru Beverage Group formed an exclusive partnership with cannabis producer CannTrust and developed its own cannabis sales platform.

CannTrust has made “significant investments” in capacity and innovation to create the “next generation” of cannabis products, including edibles and infused beverages.

Company president Brad Rogers said when the Breakthru partnership was announced: “We have a nano-technology that enables us to produce cannabis-infused beverages neutral in taste and clear as water. This technology will position us to be a leader in Canada and in future markets globally.”

Canada’s Cannabis Act stipulates the industry must follow plain packaging and labelling requirements to protect against accidental consumption, to ensure the products do not appeal to children, and to provide consumers with necessary information.

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