Format Evolution In Canada's Cannabis Market: Pre-Rolls Drive Expansion

Cannabis pre-rolls are emerging as a key driver of the growth of Canada’s recreational cannabis market. Which other cannabis products have seen significant growth in the second quarter of 2023? And, how do these trends provide valuable insights for industry players in Canada's recreational cannabis market?

Pre-Rolls Powering Growth in the Canadian Market

Based on data from the analysis platform Hifyre, Zuanic & Associates, highlights that pre-rolls have played a pivotal role, contributing nearly two-thirds of the overall expansion in Canadian recreational sales during the second quarter of 2023, compared to the same period the previous year.

Come and meet Pablo Zuanic, managing partner at Zuanic & Associates, at the upcoming Benzinga Cannabis Capital Conference this Sept. 27-28 in Chicago.

Accounting for 30% of total recreational sales in Canada, pre-rolls have made remarkable progress from their 17% share in the second quarter of 2020. This shift reflects a dynamic trend in consumer preferences, signaling a growing inclination towards the convenience and ease offered by pre-rolled cannabis products.

Format Dynamics And Shifting Preferences

Interestingly, this growth isn't evenly spread across all formats within the Canadian market.

While the total recreational sales in Canada witnessed a 10% year-over-year increase in the second quarter of 2023, sales of flowers experienced a slight decline of 1%.

Flower products, which constituted 43% of sales in the second quarter of 2022 and a significant 60% in the same period of 2020, now constitute 39% of the market.

Among the major formats, pre-rolls demonstrated robust performance, achieving a remarkable 23% year-over-year growth, while vape products also stood out with an 18% increase, both outpacing the overall market growth. On the other hand, flower products witnessed a dip in sales.

Canadian Pre-Rolls Lead the Way: Outpacing U.S. Markets

Comparing these trends to the United States, it's evident that Canada is setting a noteworthy benchmark.

Pre-roll penetration in Canada has reached 30%, surpassing California, where pre-rolls constitute only 17% of sales, and even many other U.S. states such as Massachusetts (18%), Michigan (16%), and Colorado (9%).

Other Notable Growth Trends

• Edibles have shown a robust 17% year-over-year increase, capturing 6% of total sales, while concentrates surged by 26% (5% of sales).
• Oils experienced a 12% decrease (2% of sales), while beverages slightly declined by 4% (2% of sales).
• Topicals struggled to gain traction, experiencing a 9% year-over-year decline and contributing only 0.3% of sales.

The Benzinga Cannabis Capital Conference, the place where deals get done, is returning to Chicago this Sept 27-28 for its 17th edition. Get your tickets today before prices increase and secure a spot at the epicenter of cannabis investment and branding.

Photo by Suzanne D. Williams on Unsplash.