Marijuana oil seems to becoming Canadian legal marijuana consumers preference instead of purchasing flower according to data from Health Canada. Many consumers may not have even heard of cannabis oil before the legalization wave hit North America, but people seem to be embracing vaping for health, ease and cleanliness reasons. Do you still prefer smoking legal flower, or have you been won over by oil?
If earnings reports from Canadian licensed medical cannabis producers did not prove that the market prefers cannabis oil to dried cannabis, then the numbers out of Health Canada should.
The number of Canadian medical marijuana patients continues to grow rapidly and as of March 31st, there were 167,764 registered patients (almost 30% higher than the prior quarter).
Health Canada reported that 5,673 kilograms of cannabis oil were sold during the quarter that ended on March 31st. This number is 38% higher than the prior quarter and 870% higher than the same quarter last year.
Numbers Show a Remarkable Trend Toward Cannabis Oil
When you look at the amount of dried cannabis sold, this number increased by less than 10% when compared the prior quarter and less than 30% when compared to the same quarter last year.
Numbers don’t lie and this helps confirm that smoking dried marijuana is declining. Licensed producers have recognized this trend and are focused on increasing capacity to satisfy the higher demand.
When compared to the prior quarter, the amount of dried cannabis in the licensed producers’ inventories increased by less than 0.3% while the amount of cannabis oil increased by almost 40%. When compared to the prior year, the amount of dried cannabis increased by less than 70% while the amount of cannabis oil increased by more than 265%.
A More Attractive Opportunity
Cannabis oil is in high demand and licensed producers have many reasons to want to capitalize on this opportunity. One of the main reasons why we are favorable on this trend is due to the fundamentals.
Cannabis oil costs the consumer more and is a higher-margin product. The combination of high demand and better fundamentals is a great situation for any licensed producer and we expect to see producers continue to focus on this side of the business.