Following recent news reports that marijuana will be legalized by July 1, 2018 in Canada, the Canadian Stock Market began a quick spike upwards in this area. Introduction of legislation legalizing marijuana will begin in April.
Its introduction into the House of Commons is expected to be viewed as a further stock industry catalyst. It is believed legislation will add momentum to the stock spike. The news of coming legislation gave a prominent, sector-wide boost to Canadian medical marijuana stocks, such as “Aurora Cannabis Inc”. Its stocks jumped nine percent on Monday to $2.48 per share.
Executive Vice-President of “Aurora Cannabis Inc.”, Cam Battley, has stated that sector growth such as this, will also open up opportunities for other businesses that are affected either directly or indirectly. Such companies would include those in the areas of research and information technology.
“Aurora Cannabis Inc”, which had one of the biggest stock boosts is Alberta-based and is building a state-of-the-art facility at the Edmonton Airport, stretching to approximately the size of 16 football fields.
Canada’s largest marijuana company, “Canopy Growth Corp”, also jumped nine percent to $10.84, while lesser known companies, like “Organigram Holdings Inc.”, managed to come up with an increase to $2.42 per share, after trading on the Toronto Stock Exchange on Monday.
Suggested word to investors is to take profits immediately as there may be a slower climb now that the announcement has been made. To predict slower profits in the future, however, is debatable and possibly premature.
A Federal task force set out an 80-recommendation and rules report in November for legalization. Companies are strongly urged to comply. This was met with a heavily positive reaction by Canada’s licensed producers as it basically confirms that the present Health Canada system for medical marijuana will carry on with more strength and credibility. They also want to assert that they will be the prominent suppliers for marijuana used recreationally.
The Health Canada system has very stringent controls for what is a highly competitive and growing industry. Prices will be controlled by each Province individually, as well as distribution. Each Province will also have the option to establish age limits which may differ from the Federally suggested age of 18. Also presented in the recommendations are stipulations that for Canadians who wish to grow their own marijuana, that each household will be limited to four plants.
Reportedly, the Federal Government will likely introduce the legislation on or close to the significant date of April 20th (4/20). This has been a date adopted by marijuana aficionados as a historical, counter-culture day of significance, where in previous years, marijuana advocates have met in large numbers on Parliament Hill.
This article was written by Donna Murchie.