The Legalization of Marijuana Is Huddle’s Business Story of the Year

Dec 21, 2017 by Mark Leger

FREDERICTON – The New Brunswick government moved faster than other provinces in setting the stage for a legal cannabis market and it more overtly made the economic development case for the sector, making marijuana Huddle’s business story of the year for 2017.

The province acted so quickly (relatively speaking) that it received accolades from industry insiders. At last months Canadian Canadian Cannabis Awards in Toronto, New Brunswick was named the “Most Progressive Public Office.”

Like every province, the government has stressed the importance of protecting youth and killing the black market through legalization. And it insists those are still the main priorities, said Finance Minister Cathy Rogers in a phone interview Thursday.

“New Brunswick is always open for business,” she said, but reiterated the main priorities around youth protection and halting the illegal trade of marijuana.

Nonetheless, the province’s decision to embrace the economic development potential of the marijuana industry and initiate the steps to make that happen has kept the story in the news for most of the year.

It made the industry a priority in The New Brunswick Economic Growth Planreleased late last year. Ray Gracewood, the chief commercial officer of Organigram, credits the province for taking a progressive approach to the issue.

“We’re blessed to be in a province that’s been progressive and bullish on the file and has been for the last year and a half,” said Gracewood in an interview earlier this fall. “It has done a great job understanding that this is a huge economic opportunity for both the province and the companies that could potentially exist within the province.”

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Organigram is a national leader in its own right, winning three Canadian Cannabis Awards this year. It will also be one of the three suppliers to the province’s recreational market, along with Ontario-based Canopy Growth and Zenabis.

All three suppliers already have, or will soon have, grow operations in the province, one of the many job creation opportunities that will come with legalization.

“Whether it’s from a job creation standpoint, a tax base standpoint, spinoff ancillary business standpoint there’s an awful lot of cannabis relevant industry that will be ripe for the picking,” said Gracewood. “New Brunswick has done the best job of proactively going after companies that want to set up shop to take advantage of the adult recreational market. When we go to industry events we’re essentially the envy of our peers.”

Of course, the province has made some missteps in the eyes of industry proponents. It was widely mocked for its decision to require people to keep their marijuana products in a locked room or lockbox of some kind.

It also decided to go with publicly run stores, rather than private-sector retail stores that will exist in provinces like Newfoundland. Rogers said the province may eventually transition into a model that includes the private sector, but the government believes that publicly run stores are the best way to protect public safety. The stores will be tightly regulated and will counter the black market by selling high-quality marijuana at competitive prices.

In the last two weeks, the province has announced the name of the new stores, CannabisNB. It revealed the locations of 11 of the 20 stores that will open across the province next July, and it also gave the public a glimpse into what the stores will look like.

In a recent interview with The Canadian Press, New Brunswick Liquor Corp. spokesman Mark Barbour spoke about the new stories in a way that reflected the delicate balance between public safety and providing an inviting consumer experience.

“Think along the lines of a jewellery store. Very chic, very modern, very clean-cut lines,”  said Barbour.

“That’s where the product will be kept, in locked glass cases, and from there the transaction will be made and proceed to a point-of-sale area.”

RELATEDHere Is What the CannabisNB Store Will Look Like

Now we just need to find how many New Brunswickers will become marijuana consumers.

The polls over the past few years consistently show the majority of people support legalization, but a recent Corporate Research Associates (CRA) showed that they might not be big consumers of the drug, at least initially. Only two in 10 New Brunswickers said they will either definitely or probably buy marijuana products when the stores open next July.

“Based on current purchase intentions for marijuana for personal use, the market for this product may be less than many anticipated in New Brunswick,” said Don Mills, chairman and CEO of Corporate Research Associates.

Gracewood said that New Brunswickers have nonetheless come a long way in their attitudes toward cannabis in the last few years, and he expects attitudes to continue to shift over time.

“In my view, it’s the speed at which perceptions have changed,” he says. “Two years ago, people still talked about marijuana in hushed tones, never in a public setting. It’s what you talk about late nights at a party maybe.

“Fast forward less than 12 months. It’s in the news so much. It’s become a sort of inevitability that everybody is getting really comfortable with it really quickly. Now I can have a conversation about different vape pens or different sizes of rerolls …and it’s just as it was like anything else.”

Banner image: Canopy Growth partnered with Snoop Dogg on a line of cannabis strains, and Organigram has formed a strategic partnership with the Trailer Park Boys. Both companies will be suppliers to the New Brunswick recreational marijuana market. Brian Gallant is the premier of New Brunswick (photo illustration/Huddle).

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