Cannabis Weekly Round-Up: Illinois Sets Date for Recreational Sales
The Investing News Network rounds up some of the biggest company and market news in the cannabis market for the past trading week.
During the past trading week (June 24 to 28), the state of Illinois announced the start date for its recreational marijuana program.
The creation of a new league of marijuana corporations seeking to protect their interests made headlines, while an international shipping announcement also caught attention.
Here’s a closer look at some of the biggest news during last week’s trading period.
Illinois sets date for recreational marijuana sales
The state of Illinois announced the launch of its adult-use cannabis program after Governor J.B. Pritzker signed a legalizing bill on Tuesday (June 25).
Illinois is now the 11th state to legalize adult-use marijuana use, with sales beginning in 2020. As with other emerging cannabis markets in the US, a variety of publicly traded multi-state operators will vie for a stake in this market.
Marijuana Business Daily indicates that Illinois’ recreational program will reach a value of US$2.5 billion per year.
Canadian cannabis leaders join forces for business interest advocacy
As a way to protect the business interests of the Canadian cannabis industry, the Canadian Chamber of Commerce unveiled a new association on Tuesday.
The National Cannabis Working Group will seek to advocate for and participate in the development of policies affecting the market.
The initial members of the group include some of the leading public cannabis producers. Ryan Greer, senior director and cannabis policy lead for the Canadian Chamber of Commerce, told the Investing News Network that the door is open for new members to join.
“There’s … an opportunity to continue to educate elected officials, those who may be putting their names on the ballot for the federal elections this fall, federal servants and regulators and the broader public … (about) what the economic potential for this sector can be if we get a lot of (marijuana policies) right,” Greer said.
Greg Engel, CEO of Organigram Holdings (NASDAQ:OGI,TSXV:OGI), told Yahoo Finance Canada that this new group will seek to protect the Canadian market and its stakeholders from growing business threats.
“What I really do see as a threat to the Canadian industry is changes in the US from a regulatory framework perspective,” Engel said. “We’ve got an opportunity to build on the advantage we have in the near-term.”
Tilray (NASDAQ:TLRY) confirmed on Tuesday that it has started importing “cannabis oral solutions in bulk” from Canada to its UK-based operation. The marijuana producer informed shareholders that it will be able to serve patients in the European nation.
Sascha Mielcarek, managing director of Tilray Europe, said more countries on the continent are recognizing and getting up to speed with the medical cannabis market.
“Regulations are progressing as more and more countries across Europe are recognizing the benefits of medical cannabis and its potential to improve patients’ quality of life,” Mielcarek said.
The note says the company could see losses before interest, taxes, depreciation and amortization (EBITDA) of C$314 million and C$77 million in 2020 and 2021, respectively, due to current operating costs seen by the firm.
“We believe the operating expense needed to ramp manufacturing and processing capabilities in fiscal 2020 could be higher than expected,” the BMO analysts wrote.
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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.