Why Aurora Cannabis May Have Made a Big Mistake By Not Partnering With a Beverage Company
Cannabis-infused beverages could soon be a big hit. Being able to drink a beverage, get a buzz, and not be hungover the next day could prove to be an easy sell to people who consume alcohol. While the segment hasn't taken off in the U.S. where beverages still represent a very small fraction of cannabis sales, that might not be the case for much longer.
North of the border, Canada is expected to permit edible marijuana sales later this year, including beverages. Industry giant Canopy Growth (NYSE: CGC) partnered with big brewer Constellation Brands (NYSE: STZ) and Hexo Corp (NYSE: HEXO) also has a deal in place with Molson Coors Canada. It's going to be the first time some of the big players in the beverage industry take a crack at producing cannabis-infused drinks, and how successful their products are could be a good indicator as to just how big the global market for cannabis beverages will be. For beer makers, it presents a great opportunity to take advantage of the fast-growing cannabis industry and a way to give their sales a big boost while potentially reaching a new type of customer.
The Canadian market will be an important one because for cannabis-infused beverages, those products will be legal across the country, offering a complete picture of the market as a whole, rather than being limited to certain areas, like in the U.S. where recreational pot is only legal in 11 states. However, not all of those states are ready to sell adult-use products just yet. It's also important to note that wellness beverages that contain cannabidiol (CBD) derived from hemp are more readily available across the U.S. than these recreational products are, thanks to the passing of the farm bill late last year. The market for them just isn't nearly as promising.
Source Fool.com
