Coor’s, the world’s seventh largest brewer, has decided it’s stepping into the cannabis game. Molson and Hexo Corp. announced Truss, a joint venture to develop cannabis-infused drinks for sale in Canada. The corporations hope to release the products next year to coincide with the country’s federal lift on its edibles ban.
Mark R. Hunter, Coors’ CEO, delivered the news during the company’s third-quarter earnings report on Wednesday. The announcement caused Coors’ stock to rise on the Toronto and New York stock exchanges. “We will be in a ready-to-go position and, you know, one of the first on the playing field as the market opens up,” said Hunter.
The move into the largely unproven edible market has been seen by some as a strategic pivot from Coors’ decreasing profit margins in its alcohol sales. These declines may be further exacerbated by the spread of legal cannabis, according to Coors. “The emergence of legal cannabis in certain U.S. states and Canada may result in a shift of discretionary income away from our products or a change in consumer preferences away from beer,” stated the company’s 2017 year-end shareholder report.
Coors isn’t the only large corporation to use Canada’s legalization as a catalyst for entering the marijuana market, however. In October, the parent company of Corona, Robert Mondavi wine, and Svedka vodka announced it was taking a chance on pot-alcohol partnerships. That move took the shape of a $4 billion equity investment in Canopy Growth Corp., the highest traded marijuana stock in the world. The same month saw Walmart announce that it was doing “preliminary fact-finding” on selling weed products in Canada.
Cannabis Infused Beverages are Already Trending
Smaller brewing companies throughout the United States have already taken the jump into cannabis beverages. Dodging the ever-changing state regulations, though, has made maintaining sales challenging. Currently, offerings in the field include New Belgium’s The Hemperor, made from hemp and beer hops; and Coalition Brewing’s Two Flowers IPA, a CBD-infused beer.
Coors company representatives did not specify details about the drinks that are being developed, but Hunter cited estimates that non-alcoholic cannabis beverages could eventually comprise 20 to 30 percent of Canada’s ravenous legal marijuana market. Such is the current rate of demand in the first weeks of legalization there that some licensed producers and distributors are having trouble keeping the cannabis products that are legal in stock.
But There’s a Loophole
Canada’s Cannabis Act went into effect on Oct. 17, but not all products are available for purchase yet. The legislation’s roll-out date for edibles is approximately one year after legalization. Ultimately, the kinds of edibles that will be legal will be determined by individual state governments.
Not all Canadians can stand the wait for edible products. Some companies are working around the regulatory delay. In South Surrey, British Colombia, a small company named Grow Guide sells marijuana baking kits. The packages come with everything you need to make canna-butter, honey, coconut oil or candies — except marijuana.
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Author: Caitlin Donohue