In Canada, speculators have billions of dollars on the line believing that mining green marijuana gold 1/ is a win-win situation. At the epicenter is public policy that will be dictated, dissected, analyzed, and second guessed by both sides of the marijuana equation. The process will create market swings possibly experienced only once before. The time was February 1637 when the Dutch Golden Age created the “tulip mania.” Lowly flower bulbs worth less than a nickel a piece sold for tens of thousands of dollars and then dramatically collapsed. In hindsight, who would buy a single tulip bulb for $25,000? Many did on the belief that higher prices were around the corner. That insanity certainly is alive today.
Is lowly weed in a similar situation? Possibly, but not quite. The difference is the commodity's worldwide acceptance. Referring to the UN’s International Narcotics Control Board 2016 report, the United Kingdom produced 52 percent of all legal marijuana, representing 95 tons, followed by Canada’s 80.7 ton. Included in the production game was Portugal with 21 tons and Israel with 9.2 tons. As for illegal pot, it is consumed worldwide with whopping tonnage approaching 400 tons in calendar year 2017.
For 5000 years marijuana has been intertwined with history. The ancient Chinese before 2700 B.C. experimented with weed, brewed its flowers for medicinal purposes, used pollen dust to heal wounds, and even used the plant as insulation for their homes. It would be safe to say marijuana was and still is a universal necessity. Archaeologists routinely excavated it throughout the globe, while academics focused more on carbon-dating than its medicinal properties. Throughout history, marijuana was referred to as the “wonder plant.” Whatever the continent, marijuana was used and praised.
At this point in history, how and why marijuana was derailed is immaterial. The truth has been exposed, and there’s no turning back. The social value of marijuana, whether medical or otherwise, has been prospected for the benefit of all. The commercial value was never questioned, especially by black marketers. For over 5,000 years marijuana was a cash crop making a select few very rich. With Canada in the game on a national level, other countries have taken notice. Their “home field advantage” instantly makes Canada a world leader, and its business model will be the blueprint of all nations to emulate.
With a multi-trillion-dollar potential, there is a great fear of being left behind. Reminiscent of the fervor during the 1990s dot-com boom, the leading 13 public Canadian marijuana companies are worth $49 billion US, a value beyond realistic worth. Whether these companies can grow into the valuation of a price-earnings ratio is another story. Current data suggests the potential for gains is greater in the U.S. public and private markets. This is not to say that Canadian public companies are overvalued, only that the probability for further meteoric gains is more likely on this side of the border.
At the moment 120 Canadian businesses growing medical marijuana have licenses and have been legal since 2011. More are on the way with the country’s largest, Shoppers Drug Mart, recently granted a license to produce medical marijuana. Other significant sectors, such as alcohol companies, beverage companies, and product marketers are not in heavily and are merely making modest investments. Billions of dollars are on the sidelines and a potential source of “tulip mania.”
As the Canadian rules are implemented, only dried cannabis, oils and seeds will be on sale this month to the general public. Eatables and drinkables are on the way as the cannabis industry plans for the future. Players who supply specialty fertilizers, production and extraction hardware, computer software for management, tracing systems and related industries will benefit and continue to do so in the future. It is prudent to research and invest in these outside companies. A free list is available – ask for Fold CR-701.
The census agency, Statistics Canada, stated that in calendar 2017, Canadians purchased over 5.7 billion Canadian dollars’ worth of marijuana of which 90 percent was attributed to black market dealers and underground websites. Even with the legal recreational presence, the black market will still rule since their prices will be lower and the selection of products greater. Naturally, the government vowed to destroy the underground markets, but this will not happen. As in the United States were states have approved sales, the black market still controls 85 percent of gross revenue.
Adding to the conundrum, the Canadian government mandated that marijuana be sold in plain packages with prominent health warnings and small logos. Such advertising is what Health Canada, the federal department that regulates cannabis, calls “information-type promotion” and “brand-preference promotion.” Their intent to discourage the underage populace from purchasing is not going to work. The campaign will foster curious excitement and greater black-market sales.
The potential legitimate market for cannabis is at least a six hundred times greater if the pundits calculate in the black-market sector. Even with a modest twenty percent conversion to legal transactions in the next twelve months, the marijuana industry will grow exponentially. That’s the real potential GREEN RUSH, and how speculators are viewing the marketplace.
Keep your belt-wallet strapped in; this may be a bumpy ride. If you know where to dig for marijuana gold, south of the border appears to be less dicey. Remember, it’s not the size of the shovel, but how you use it.
1/ Green Marijuana Gold™ is a trademark of First Jersey Cannabis Corporation.