North America has a supply issue. Too much product is on the market. So much so even value adds (cookies, gummy bears and cleaver/trendy/market segmentation marketing) is not assisting with raising enough demand in the recreational market.
Australian cannabis producers do not have authority to grow for recreational purposes. Raw product imported for medicinal use does not have to meet the same stringent production standards as the Australian market does. Hence, cannabis is cheap to import and turn to medical product .... but there is little value in having a purpose built cannabis location with plant and equipment paid for.
The value of pot producers in Australia is heavily diminished until the competition of imports is brought to a level playing field, supply slows in the Americas or demand dramatically increases.
The referendum on Oct 17 in NZ may lead to a new recreational market (increase demand) with time.
The Department of Health applying higher standards on the manufacturing of medical grade cannabis to imported product would raise Australian produced products value.
We just sit here and wait in the mean time and hope Mildura has insurance if it all goes to shit and bushfires f* up everything this summer.
CAN Price at posting:
38.5¢ Sentiment: Hold Disclosure: Held
