How to understand cannabis’ impact on alcohol sales in Canada

3 mins read

The CCSI was assessed at C$5.00 per gram this week, down 1.5% from last week’s C$5.07 per gram. This week’s price equates to US$1,817 per pound at the current exchange rate.

Each week, Business of Cannabis delivers a series of insights from our partners at Cannabis Benchmarks®.

This week, Cannabis Benchmarks examines whether legal cannabis sales in Canada have impacted alcohol sales.

With the legalization of recreational cannabis in October 2018, alcohol companies feared they would see a reduction in sales, as consumers of legal age might opt to substitute cannabis for alcohol. However, data shows that alcohol sales have been growing steadily despite the introduction of legal recreational cannabis sales. Since August 2020, monthly alcohol sales have grown by C$132M to C$2.27B. Meanwhile, monthly legal cannabis sales have grown by C$109M to reach C$357M.

So far it appears that legal cannabis sales have not eaten into alcohol sales, but Cannabis Benchmarks does believe that, at some point, they will.

Cannabis sales are already starting to represent a larger portion of the total dollars spent towards alcohol and cannabis. Currently, cannabis’ share stands at 13.6% of the total spend of the combined categories, up from 10.4% in August 2020, and we expect that growth to continue.

Source: Canada Cannabis Spot IndexCannabis Benchmarks

See previous weekly updates from Cannabis Benchmarks:

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Understanding cannabis retail store growth in Canada

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Legacy and legal cannabis sales three years after legalization?

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