Mexico plans to legalize recreational cannabis this October

Mexico could have significantly greater long-term sales potential for its cannabis market than Canada

Bethan Rose Jenkins, Cannabis News Writer/Editorial

It’s hard to ignore the rate at which the cannabis industry is growing, and it looks like Mexico could be next to enact legislation. In fact, recent reports have revealed how the North American country plans to legalize pot before October.

Support for cannabis legalization in the U.S. has jumped from 25 percent in 1995 to 66 percent in October 2018. This is based on data published in Gallup’s national poll. Since that same year, the number of U.S. states that have legalized cannabis for medical purposes has climbed from zero to 33, with an additional 10 U.S. states also legalizing weed for recreational purposes.

Cannabis reform is noticeable beyond the borders of the U.S. also, with its Northern neighbor Canada legalizing cannabis in October of last year. Uruguay is the only other country in the world to fully legalize the drug for recreational and medical purposes.

Mexico legalized cannabis for medical purposes in 2017

In June of 2017, Mexico legalized medical cannabis and now, Mexico’s lawmakers are being urged by the nation’s Supreme Court to legalize recreational cannabis. Since 2015, Mexico’s Supreme Court has deemed the ban on the recreational pot as unconstitutional five times; enough for the case to be sent to Mexico’s Senate, where the existing laws must now be changed to reflect this ruling. Lawmakers will reportedly redraft legislation between May 1 and August 31.

In 2018, Canada’s population rested at 37 million and approximately one in six Canadian adults used cannabis during the fourth quarter of the year. Around 4.6 million or 15 percent of Canadians aged 15 and above reported using cannabis in the last three months, according to Statistics Canada’s national cannabis survey for Q4 2018.

Then there’s Mexico, which is home to some 130 million people. Should the consumer rate be on a par with Canada’s, Mexico could have significantly greater long-term sales potential for its cannabis market.

Two cannabis stocks already have a presence in Mexico

In the event that complete cannabis legalization unfurls across Mexico this October, two particular pot stocks look set to do pretty well: Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC).

Aurora Cannabis – a major Canadian cannabis producer – announced in December that it would be acquiring Mexico’s Farmacias Magistrales. The company boasts numerous sales channels countrywide and it was the first Mexican company to obtain a license to manufacture, store, distribute and import cannabis in Mexico.

Another big player in the Canadian cannabis market that could get in at the ground floor in Mexico is Canopy Growth. The company’s international medical cannabis brand, Spectrum Cannabis, already boasts a presence in some other South American countries, including Colombia, Peru, and Chile.

With Mexico on the cusp of launching a recreational cannabis industry that could seriously outshine Canada’s, investors won’t want to ignore this segment of the pot stock market.