While legislators prepare to expand cannabis legalization to include infused snacks and drinks, the food and beverage industry also needs to be ready to take advantage of a massive opportunity for edible products, according to a new study.
In his latest study ‘The Trouble with Edibles,’ Sylvain Charlebois, a professor at Dalhousie University and expert in food distribution and policy, says cannabis-infused snacks and beverages “stand to shake up current players in the food sector.”
“With adequate safety measures, edibles present a hugely profitable opportunity for the Canadian food industry,” Charlebois wrote. “No one really knows for certain what the market potential is for cannabis, much less for edibles, but growth opportunities are palatable.”
Charlebois notes the hurdles that must be cleared with the legalization of edibles, including regulation, labelling, dosage and keeping them out of the hands of minors.
Bill C-45 did not initially include edibles, but was added by the parliamentary health committee last fall. Edibles are expected to be legalized in “less than a year’s time,” according to Charlebois.
However, the growth seen in U.S. states where cannabis have been legalized - California and Colorado – is already pointing to a large market opportunity for edible products. Charlebois reports that edibles accounted for 10 per cent (US$180 million) of the state’s cannabis market this year, while Colorado has seen about a 60 per cent rise in edible sales in each of the last two years. The Colorado Marijuana Enforcement Division said the state’s marijuana shops sold 11.1 million edibles in 2017.
Edibles are already riling Canada’s wine producers, Charlebois writes.
“[M]any wine producers are concerned about what a mature cannabis market will look like. For Ontario, British Columbia and Nova Scotia – where the wine industry is flourishing – this could be a problem.”
“We could see some consumers substituting their usual wine, beer or spirits for a cannabis-infused spaghetti sauce, or possibly even cannabis oil.”
Some cannabis CEOs, including Canopy Growth’s Bruce Linton, have vocally touted cannabis as the healthy alternative to drinking. Linton told BNN Bloomberg last week that he was eyeing a new alternative to wine and beer through his company’s beverage partnership with Constellation Brands.
“A lot of people are just trying to make a beer with inputs of cannabis in it and brew it,” Linton said. “Where we want to take people is more to a new category. Like, if you said: ‘What’s Red Bull?’ Red Bull is Red Bull.”
“I don’t understand why we have an obligation to pirate a beverage called beer, which is intended to make us fat.”
Charlebois said pot companies could likewise target the food industry by touting cannabis as “the next superfood.”
“The cannabis plant is full of nutritional value,” Charlebois wrote, noting the presence of protein, vitamins E and C and other nutritional elements. “For food manufacturers looking for a new value-added feature, cannabis could potentially be the next omega-3 or probiotic.”
“The more consumers are exposed to cannabis, the more they will opt for the edible version. Quite simply, this is a potential phenomenon akin to what the industry saw with sales of gluten-free products.”
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