Canada’s cannabis industry, which has been active since the passing of the Cannabis Act in October 2018, seems to be going through a slightly stagnant period. 

Recent sales figures published by Canada’s federal data authority, Statistics Canada, show that retail sales of legal recreational cannabis slipped to CAD$353.7 million (USD$282.5 million) in November.

In comparison with sales figures recorded in October, the latest figures represent a 2.9 percent decline. Analysts attribute the revenue drop to the fact that Canadian cannabis prices fell consistently throughout 2021.

It’s also important to note that Canada’s cannabis sales revenue plummeted for the first time in November since February 2021. Consequently, this meant that the market’s eight month growth streak has officially been disrupted.

Recreational cannabis sales tumbled month-to-month in November

All of Canada’s 10 provinces except Ontario and Saskatchewan saw sales nosedive in November. Ontario’s continued success is not overly surprising considering the fact that it is the nation’s largest cannabis market.

Specifically, Ontario’s cannabis sales revenue inflated 1.9 percent during the month of October to CAD$148.4 million (USD$117 million), marking a new provincial milestone that constituted almost 42 percent of all legal recreational cannabis transactions recorded across the “Great White North” in November.

Over in the rocky-terrained Prairie province of Saskatchewan, monthly sales revenue increased 1.5 percent to CAD$14 million (USD$11 million).

Let’s take a closer look at November’s revenue and month-over-month sales in the rest of Canada’s provinces:

• Alberta: USD$46 million (-6.6 percent)
• Québec: USD$38 million (-6.8 percent
• British Columbia: USD$38 million (-5.3 percent)
• Manitoba: USD$10 million  (-6.5 percent)
• Nova Scotia: USD$5.8 million (-8.2 percent)
• New Brunswick: USD$4.9 million (-13 percent)
• Newfoundland and Labrador: USD$4.2 million (-6.3 percent)

Canadian cannabis sales could reach multi-billion dollar record this year 

Looking ahead, sales estimates for Canada’s recreational cannabis markets look promising. 

According to predictions from analysts at ATB Capital Markets, sales could top CAD$4.8 billion (USD$3.8 billion) in 2022, which would represent a 19 percent increase from the estimates that were drawn up for 2021. ATB’s calculations are slightly less than the CAD$4.9 billion (USD$3.6 billion) that was previously forecast for this year.

The report, which was composed by analyst Frederico Gomes, predicts that Canada’s recreational cannabis market will surge at a compound annual growth rate (CAGR) of approximately 13.4 percent from 2021-2030, at which point sales may erupt to highs of CAD$12.3 billion (USD$96.7 million).

“While the industry continues to struggle due to fragmentation and price competition, we believe that players with a lean cost structure, a robust capital position, and operational efficiency can successfully navigate this environment,” the report notes. “M&A alone has failed to drive consolidation because market share is volatile and integration is a distraction to an acquirer’s operations.”