Canadian Cannabis Retailers Are Running Out of CBD
Cannabis retail outlets across Canada are in the middle of a nationwide shortage of legal cannabis products, but one product is proving to be more elusive than most: cannabidiol (CBD) oil.
“I don't think the licensed producers really realized how popular CBD was, so there's none available, really,” said Kristin Wetulani, the founder of Vancouver’s City Cannabis Co., to CTV News. “When something becomes available on the cannabis wholesale ordering sheet, everybody tries to get all that's available. It's like a race.”
What is CBD oil, and why is it so popular?
Cannabidiol, or CBD, is a non-intoxicating cannabinoid that can be isolated and extracted from both cannabis and industrial hemp plants. It has gained a reputation as a natural treatment for anxiety, depression, pain, and other common ailments, despite clinical study of the extract still being in its early stages.
Because of this reputation, CBD has quickly become a trendy product within health and wellness circles, with CBD-infused snacks, candies, make-up, and even haircare products proving popular in the online marketplace. At the end of 2018, rumors that the beverage industry giant Coca-Cola was considering development of a “functional wellness” CBD beverage made headlines worldwide.
The passing of the Farm Bill and subsequent legalization of hemp and hemp-derived cannabinoids, such as CBD, in the United States last December also contributed to the growing hype surrounding CBD products, as once again the industry was thrown into the public eye. In Canadian law, CBD products are legal, but strictly regulated; only licensed producers are allowed to extract and process CBD, and only registered retailers may sell CBD-containing products.
“Because of the farm bill passing, the sexiness or the in-vogue profile of CBD went through the roof,” explained Khurram Malik, the CEO of the cannabis company Biome Grow, to CTV News. “The demand side just blew up and caught everyone by surprise, on both sides of the border.”
Social media buzz from celebrity influencers has also added to the CBD hype. Last month, Kim Kardashian West threw a CBD-themed baby shower which included a CBD “bar” and a station where guests could make their own CBD-infused bath salts and body oils, with the whole event being documented on social media.
Producers push to meet CBD product demand
Suppliers of CBD products have been doing their best to cope with the surging demand. But given the time that it takes to grow the crop that CBD is extracted from, there may not be an effective short-term fix.
“There has been a significant learning curve for licensed producers as they transition into supplying a new market,” said British Columbia's Liquor Distribution Branch in a statement. “Licensed producers are working towards becoming more efficient, however many of their expansion projects have not yet been fully ramped up.”
Ray Gracewood is the CCO of OrganiGram, a licensed cannabis producer based in Moncton, New Brunswick, which supplies much of Nova Scotia with its cannabis product. In an interview with CBC in March, he admitted that the demand for CBD oil and CBD products in general far exceeded the expectations of Canada’s cannabis producers.
Gracewood says that OrganiGram has been reserving its current supply of CBD oil for medical cannabis patients who may be prescribed the cannabinoid. In the meantime, the company has moved its focus towards trying to fill the supply gap for retail stores.
“It represents almost half of our business now,” Gracewood said in reference to OrganiGram’s medical CBD business. “The reality of the production environment is that cannabis takes a certain amount of time to grow within our facility and therefore it takes us some time to adapt to changes within forecasting.”
OrganiGram is still the subject of a class-action lawsuit arising from several cases where cannabis originating from OrganiGram was found to be tainted with unapproved pesticides. During the interview, Gracewood did not comment on whether these cases had affected the company’s production.
The way forward for CBD in Canada
Maintaining a reliable supply of CBD oil and CBD products for the medicinal cannabis community will be a top priority over the duration of the cannabis shortage. Imports of CBD products rose slightly over the past year, up from 30.7 kilograms in 2017 to 44.9 kilograms in 2018, as did the number of import licenses issued by Health Canada. However, as things stand, CBD imports in Canada are currently only allowed for medical or scientific purposes. Still, making smart use of CBD imports may help secure a stable supply of CBD oil for medical cannabis patients, and take the strain off Canadian producers who are trying to provide for the medicinal and recreational markets.
Some provinces do still have supplies of other high-CBD products, just not CBD oils. For some consumers who want CBD products for recreational use, these may still be an attractive option.
“We currently have products containing up to 20 percent CBD but not the pure CBD oil,” said Beverley Ware, a spokesperson for the Nova Scotia Liquor Corp., to CBC. “Every province is in the same situation.”
There may be no quick fix to Canada’s cannabis and CBD shortage; consumers may just have to wait until new crops can be grown and processed. Extracting CBD from hemp, which contains high levels of CBD and low levels of the intoxicating cannabinoid THC, is generally the most affordable and least involved way to produce high volumes of CBD extract, as the plant itself can be grown outdoor on a large scale and is subject to fewer restrictions in Canada than the cultivation of high-THC marijuana plants. But as the country waits for these crops to mature, the CBD shortage will continue.
“It's not easy,” explained Ivan Ross Vrana, a cannabis advisor at Hill+Knowlton Strategies, to CTV News. “I know people think, 'It's just a weed. We can grow this no problem.' It's not. You're still growing a plant and Mother Nature has a large say in that.”