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How legal cannabis sales in Canada have impacted alcohol sales

The CCSI was assessed at C$5.20 per gram this week, up 0.4% from last week’s C$5.18 per gram. This week’s price equates to US$1,815 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 we examine how legal cannabis sales in Canada have impacted alcohol sales. With the legalization of recreational cannabis in October 2018, some alcoholic beverage companies stated that they feared they would see a reduction in sales, as consumers of legal age may opt to substitute cannabis for alcohol.

Below is monthly data from October 2018 through early this year, showing sales of both categories. The chart illustrates that alcohol and cannabis sales were both growing steadily up until 2021. (The spike in alcohol sales in March 2020 was due to bulk buying ahead of COVID-19 lockdowns.) Alcohol sales dropped in early 2021 and leveled off a few months before cannabis sales began to plateau in late summer 2021.

That being said, since January 2020, monthly alcohol sales have grown by C$215M to C$2.27B, while cannabis sales grew by a little less – C$182M – to reach C$282M. Additionally, cannabis sales’ share of the total dollars spent towards alcohol and cannabis has increased steadily since legalization. Currently, cannabis’ share stands at 12.9% of the total spend of the combined categories.

Source: Canada Cannabis Spot IndexCannabis Benchmarks

See previous weekly updates from Cannabis Benchmarks:

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