Cannabis a new golden goose for booze business
Svedka vodka has poured $4bn into the Canadian cannabis firm Canopy Growth
The world’s major alcohol producers can no longer ignore the pot phenomenon, as young consumers may increasingly swap beer and cocktails for joints and cannabis-infused drinks.
Some have seized the moment. Constellation Brands, maker of Corona beer and Svedka vodka, has poured $4bn into the Canadian cannabis firm Canopy Growth. The coming market is "potentially one of the most significant global growth opportunities of the next decade," said Constellation CEO Robert Sands.
Sales of legal cannabis and related products should reach $200bn within 15 years and the market is opening "much more rapidly than originally anticipated," he said.
Following in Uruguay’s footsteps, Canada on Wednesday will become the second country in the world to legalise recreational cannabis. Cannabis is still banned under US federal law for any purpose but nine states so far have legalised its recreational use under their own laws, while others have moved toward softening its prohibition. As a result newer methods of consumption are proliferating: edibles in the form of candies, baked goods and ice creams as well as vaporisers and ointments.
And then there are drinks.
Diageo, the world’s largest producer of spirits including Smirnoff vodka and Johnny Walker whisky, is in talks with Canadian producers, according to Bloomberg.
Beer producer Molson Coors has also announced a joint venture with Canada’s Hydropothecary Corporation.
Researchers at the University of Connecticut and Georgia State University in 2017 found sales of alcohol dipped 12.4% in US counties where medical cannabis was legalised. But others including the Distilled Spirits Council, an industry body representing US liquor makers, say sales have not been hurt. Hemp beers and those containing cannabidiol, a cannabis component that is not psychoactive, are already available.