Canadian based Constellation Brands, the parent company behind alcoholic beverages Corona and Modelo, has recently made moves to acquire stakes in the Canadian medical marijuana firm Canopy Growth. While the deal should be completed by 2018, Constellation Brands has no plans to sell any marijuana products in the U.S. until it is completely legal to do so at all government levels. Do you believe that this is a good investment on the part of Constellation Brands?
In March of this year, it was reported that the alcohol industry stands to lose $2 billion in sales due to legal weed as drinkers ditch beer in favor of marijuana. One company read the writing on the wall and decided it was worth $191 million.
Constellation Brands, the parent company behind Corona, Modelo, Svedka, and a bunch of other booze, announced Monday that it acquired a 9.9 percent minority stake in Canopy Growth, a Canadian medical marijuana company. It plans to work with Canopy to experiment with weed-infused drinks, reports The Wall Street Journal. Big alcohol has just dipped its first exploratory toe into the cannabis market.
If nothing else, the move shows that alcohol and cannabis don’t necessarily have to be competing intoxicants. At least one huge company is reckoning with the slow (but inevitable) progress of legalizing weed by investing in it, not demonizing it. For you, that means cannabis-infused drinks could one day be available on a huge scale for a relatively low price, at least when compared to the boutique cannabis products we have now, in places where they’re legal.
It also means a whole new breed of intoxicants to consider. Cannabis-infused beers do not have THC, and therefore won’t get you high. Distillers use hemp and CBD (a non-hallucinogenic chemical in cannabis) to broaden the flavor profile of beer, often with herbal, earthy notes. Earlier this year, Lagunitas brewed a special edition beer using terpenes, an oil extract from the cannabis plant, which Fortune described as a “tangy, bold earthy ale that has strong grass and lemon notes.” Despite having virtually no mind-altering elements, hemp extracts and CBD are Schedule 1 drugs, which complicates distribution and legality in states where recreational marijuana is not legal. Terpenes, however, remain legal.
It’s evident that smaller breweries have successfully experimented with cannabis. Imagine a huge company with enough money to distribute Cannabis Corona or Marijuana Modelo to the States. It would certainly disrupt the drinks industry. Of course, Constellation won’t even consider this until recreational weed is legal throughout the U.S. Until then, Canopy plans to develop a non-alcoholic cannabis drink for the Canadian market, where legalization is just around the corner. It looks like even Jeff Sessions, in all his righteous anger, won’t be able to stop the joining of these two great vices.