Cannabis industry trend watchers have seen a shift in investors preferences. No longer is flower king—rather investors are putting more money into extraction companies.
Extraction companies—those focused on safely securing cannabis oil from cannabis flower—have seen this bump for a reason. Or, if our conjecture is correct, two reasons.
The Rise of Vaping
While many Canadians turned to flower upon legalization, it was likely because that was what they were familiar with. Because of prohibition, the black market mainly peddled bud to those willing to gamble with street weed. Now, as consumers become more comfortable with legal cannabis across the country, they are also beginning to experiment more with what’s available. If trends from US states that have had legal cannabis for years are any indication, the rise of the vape cartridge and vape pen is upon us.
While many Canadians may be familiar with electronic cigarettes or vape juice, vaping cannabis likely seems like a new frontier. However, since research has shown that vaping may be a better way to inhale cannabis, more Canadians may soon be tapping a button rather than lighting a joint or a pipe once vape cartridges hit Canadian dispensaries.
In the US states that allow for recreational marijuana, vape cartridges and concentrates gained in popularity within a year or two of their legalization. In fact, in places like Colorado, Washington, and Oregon, vape cartridges are frequently more popular than flower.
Vape cartridges and disposable vape pens are easy to use, easy to dose, and discreet. They don’t have as strong of an odor, and they can help provide recreational users with a more potent high. For many recreational adult users, it’s a lot of pros with few cons. Companies that produce vape cartridges and disposable pens are able to appeal to a large variety of consumers by creating products that clearly share their THC:CBD ratio and which can help consumers access a variety of effects.
With vape cartridges and disposable pens slated to hit the market later this year, Investors are wise to turn to extraction companies who will be supplying the cannabis oil that is used to make them. For many, it likely seems a sure bet.
The Future of Edibles
Those who have eagerly awaited the legalization of edibles and other cannabis products are counting down the days and weeks until more cannabis-infused products hit the shelves. As producers experiment with their formulas and Health Canada finalizes regulations, wise investors have begun buttressing extraction companies who will be creating and selling the very extracts and oils that will be baked up into tasty treats, mixed into beverages, and crafted into topicals.
Ultimately, cannabis oil is a versatile product with numerous applications. And those applications clearly appeal to consumers, making extraction companies a hot commodity for in-tune investors.
It seems to us that investors and those looking to invest in the cannabis industry are doing their best to get in on the latest cannabis trends before they begin. What will this mean for the future?
Likely, licensed producers and extraction companies will continue to draw interest as the second phase of legalization rolls out. Pressure will be on cultivators to provide enough flower for both sale as dried flower and for extraction. While there’s little precedent on a national scale, Canadian investors remain excited about the cannabis industry and continue to support the numerous public companies that are meeting the nation’s demand for cannabis. The market outlook remains strong, and more investors are looking to Canadian stock exchanges is an exciting opportunity.