Cannabis sales in both the US and Canada have jumped this past week on concerns that COVID-19 will lead to dispensary closures.
The COVID-19 outbreak continues to affect diverse sectors, and cannabis is no exception.
Over the past week, both the American and Canadian marijuana industries have been impacted by the spread of the virus, with sales surging on the back of concerns about coronavirus-induced store closures.
Read on for a closer look at some of the biggest cannabis news over the last five days.
Cannabis sales spikes by the numbers
As mentioned, cannabis sales in both the US and Canada have jumped this past week on store closure concerns. Many types of businesses in both countries are being forced to shut their doors to comply with new regulations to contain COVID-19, leaving consumers worried that dispensaries may be next.
Stats from cannabis market data firm Headset show that the state of Washington saw large week-on-week sales increases this past weekend, topping out at a 33 percent rise on Sunday (March 15).
Monday (March 16) sales in California leaped 56 percent over the previous four Mondays after San Francisco and five other Bay Area counties issued “shelter in place” orders.
“Once we got to Monday, the (influence of coronavirus) was unequivocal,” Eli McVey, a senior analyst at Marijuana Business Daily, told Forbes.
“Monday was a huge day for cannabis retailers across (Washington, California, Colorado and Nevada). I don’t think there’s any doubt that this was driven by the coronavirus. You talk to retailers; they’ll tell you the same thing: big increase in demand.”
Numbers from various provinces in Canada indicate high levels of buying as well. Speaking to CTV News, Daffyd Roderick, communications director at the government-run Ontario Cannabis Store, said on Thursday (March 19) that sales were up 80 to 100 percent compared to levels seen this past weekend.
Stores run by the government in BC and Quebec also said that they have seen increased levels of marijuana buying, but did not give exact stats. Purchases are also riding high in Nova Scotia, with cannabis reportedly outselling alcohol in the province.
Cannabis “essential” in some parts of the US
Consumers are rushing to stock up on cannabis due to COVID-19, but thus far it seems panic buying for the most part isn’t necessary.
In the US, a growing number of areas are designating cannabis as essential, meaning stores have been able to stay open even in places where only key businesses are allowed to operate.
San Francisco is one such area. As mentioned, the Californian city issued a “shelter in place” order on Monday, telling residents they must stay home “except for essential needs.” However, by Tuesday (March 17) officials had clarified that cannabis stores could continue operating.
“Cannabis is an essential medicine for many San Francisco residents,” said the city’s public health department in a tweet. “Dispensaries can continue to operate as essential businesses during this time, while practicing social distancing and other public health recommendations.”
On Thursday, the entire state of California was ordered to stay at home except for essential activities.
A similar situation played out in the state of New York, which on Wednesday (March 18) issued an order directing non-essential businesses to put work-from-home policies in place by Friday (March 20). A spokesperson for the state’s governor later confirmed that cannabis stores would be able to stay open. Restrictions and preventative measures intensified on Thursday.
The entire state of Nevada also confirmed on Wednesday that cannabis dispensaries can remain open during COVID-19 restrictions; however, they must stick to social distancing protocols.
On the whole, cannabis dispensaries in the US mostly remained open as of Friday, although adhering to strict rules on cleaning and social distancing is now the norm. Aside from physically maintaining distance from other people, some stores have instituted new pickup and delivery options.
In Canada, lockdown measures have generally not gotten as strict, although Prince Edward Island is an exception — the province has declared a state of emergency due to COVID-19 and on Thursday it shut down all non-essential businesses, including alcohol and cannabis stores.
It’s worth noting that while most cannabis stores are currently legally able to stay open during the COVID-19 outbreak, some have chosen to close. For example, on Wednesday, major player Canopy Growth (TSX:WEED,NYSE:CGC) shut all of its Tokyo Smoke and Tweed retail locations in Canada.
Cannabis company news
- Aleafia Health (TSX:ALEF,OTCQX:ALEAF) released its results for Q4 and the full 2019 fiscal year, reporting C$4.85 million in net cannabis revenue, a 1,748 percent increase year-on-year. It had C$41.2 million in cash and cash equivalents as of the end of the year.
- According to MarketWatch, the US Securities and Exchange Commission has asked Cronos Group (TSX:CRON,NASDAQ:CRON) to retain records related to how it recognizes certain revenue. The news came on Friday, several days after the company announced plans to restate and reissue its unaudited interim financial statements for 2019’s first, second and third quarters.
- Harvest One Cannabis (TSXV:HVT,OTCQX:HRVOT) announced that Andy Bayfield, the company’s chief commercial officer, has taken on the position of CEO; he will also join Harvest’s board of directors. Former CEO Grant Froese will leave the company and will give up his board of directors seat, but will continue to offer support on a consulting basis.
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Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.