Topic: Cannabis Investing

Cannabis in the news September 19, 2018

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With legalization less than a month away, the flood of articles and opinions on marijuana continues to swell—and each week we select the five articles that have the most to say to investors.

1. The Coca-Cola Company may be the latest beverage giant now exploring a possible partnership with a Canadian cannabis producer.

According to BNN Bloomberg, the company is in “serious talks” with Aurora Cannabis to develop cannabis-infused beverages. Coke has since issued a statement saying it had no interest in marijuana. Still, it is looking at the use of non-psychoactive cannabis ingredient CBD (cannabidiol) as an ingredient in “functional wellness beverages.”

While THC (tetrahydrocannabinol) is responsible for the euphoria, or high, associated with marijuana, CBD is the chemical associated with its  medicinal uses.

Alcoholic-beverage giants Constellation Brands and Molson Coors have already partnered with leading cannabis producers in an effort to develop marijuana-infused beverages. Their rival Diageo is reportedly looking to follow their lead.

2. Several Canadian provinces—along with cannabis producers themselves—have now selected Shopify to run their e-commerce websites.

Among those clients are the provinces of British Columbia and Ontario. Each provincial government chose Shopify to provide an online platform for the sale of non-medical cannabis. Among licenced Canadian producers, Canopy Growth, Aurora Cannabis, Hexo and, most recently, The Green Organic Dutchman have signed e-commerce deals with the company.

Those agreements have helped spur Shopify’s share price, up more than 27% in the past year.

3.  Mexico will likely legalize cannabis use in 2019, says former Mexican president Vicente Fox, suggesting a renegotiated NAFTA deal should address marijuana sales.

Fox currently sits on the board of directors for Khiron Life Sciences, a medical marijuana producer based in Vancouver. He has long pointed to the legalization of cannabis as one way to reduce drug cartel violence in Mexico.

Should the Latin American country opt for full legalization, argues Fox, it could become a major exporter of legal cannabis to both the U.S. and Canada. Mexico currently provides those markets with up to 70% of select agricultural products.

4. A Canadian employment lawyer is suggesting workers in the country’s burgeoning cannabis industry face the very real possibility of a lifetime ban from the U.S.

“If I were an employee in the medical marijuana industry—or marijuana industry more broadly—I would be leaving immediately,” Howard Levitt, a senior partner at Toronto-based Levitt LLP, told BNN Bloomberg.

Canada will legalize recreational use of cannabis on October 17, 2018, several years after Colorado—the first of many U.S. state to do so. Still, the drug remains illegal under U.S. federal law. That gives U.S. border officials the right to question Canadians entering the country on their use of cannabis and any connections they have to the industry.

U.S. border officials have already warned Canadians that they may be barred entry based on any connection to cannabis.

5. The federal government now plans to study how marijuana is sold online through the black market.

The research should better outline how Canadians buy, sell and share cannabis as well as criminal activities associated with cannabis use.

The study would also measure whether legalization is reducing criminal involvement in the cannabis market. That goal was, in fact, a key driver of the government’s move to legalize recreational use.

A 2016 study suggests cannabis represents one-third of all drug transactions online. That makes it the most popular drug sold on the so-called dark web.

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