Canada’s marijuana stocks took a tumble last week, clearly indicating that the powerful Canadian marijuana industry is affected by United States policy.
The dip was a direct result of the comments made by Press Secretary Sean Spicer during a briefing last Thursday. Spicer told the press, “I do believe that you’ll see greater enforcement of it,” when asked about adult-use cannabis in relation to U.S. federal law. Spicer added that there’s a difference between medical marijuana and “recreational use, which is something the Department of Justice I think will be further looking into.”
After the comments, Canadian-based marijuana companies took a dip; Aurora Cannabis was down 2.93 percent, Aphria Inc. down 1.01 percent, and Canopy Growth, the world’s largest producer, took a 4.64 percent hit when the markets opened last Friday.
“[It] was a pretty clear reaction that there was cause and effect based on Spicer’s comments,” said Jordan Sinclair, Director of Communications at Canopy Growth, in an interview with Marijuana.com. “This confirms what we know. Policy decision or things said by high-level U.S. officials can have an impact on the space, but it’s more a story about whether or not it should have an impact in Canada.”
Sinclair pointed out that the longer Canopy and other Canadian marijuana companies exist in a regulatory environment that “allows us to get a lead over U.S. firms, the better off we’ll be.” He went on to add that Canopy “started this business without access to the U.S. market and that continues today.”
Sinclair further relieved Canada’s bruised ego by reminding us that although U.S. policy can create investor skittishness, it’s a big world out there with many countries open to the marijuana industry. “It shouldn’t be a huge surprise that we aren’t selling [product] in The States, now we just need to make sure that the investment community understands that as well. There’s international expansion and market opportunities all over the world. As of yet, the U.S. is still an emerging one.”
Sinclair’s comments are supported by the massive amount of business that Canopy does internationally, with countries that include Germany, Brazil, Australia, and others. Their policy is to get involved with countries who have adopted reform at the federal level. “I think that people just need to understand what the market opportunities are, and for Canopy Growth, those opportunities are always in jurisdictions where there are federal sets of laws [allowing]cannabis.”
As the U.S. figures out just what its policy will be on cannabis, Canada continues to look past its neighbors to the South to make significant gains. Perhaps in the future, the “emerging market” in the U.S. will catch up.
Photo courtesy of Who is Danny
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