The chief executive of one of Canada’s cannabis producers hopes the country’s largest business association will help the industry confront its number one threat - competition from the United States.
Greg Engel, CEO of Organigram (OGI), said the scale of the cannabis business in Canada is unmatched globally thanks to its first-mover advantage among G7 nations on federal legalization. He wants the new National Cannabis Working Group to push Ottawa to safeguard that lead.
“Canada is uniquely positioned from a leadership perspective,” Engel told Yahoo Finance Canada. “We’re doing things at a scale and scope that no one else is doing.”
The Canadian Chamber of Commerce said on Tuesday that the new working group will advocate for public policies to help the industry realize its full economic potential. Organigram is among the founding members, which also include fellow licensed producers Canopy Growth Corp. (WEED.TO) and HEXO Corp. (HEXO.TO), as well as Deloitte Canada and the law firm Dentons Canada LLP.
Investor interest in high-flying pot stocks has allowed Canadian firms to spread their footprints internationally, and build massive grow facilities with global demand in mind. Meanwhile, U.S. federal law limits the reach of cannabis companies and forces production to operate at state-level scale.
The growing number of states legalizing cannabis, and anticipation for reform at the federal level, is increasingly shifting investor focus to the U.S. while encouraging Canadian producers to develop resources stateside.
Engel said while it is difficult to predict how Washington’s position on cannabis will evolve as the drug is more widely accepted, the Canadian Chamber of Commerce should prepare for the landscape to change.
“What I really do see as a threat to the Canadian industry is changes in the U.S. from a regulatory framework perspective,” he said. “We’ve got an opportunity to build on the advantage we have in the near-term.”
Illinois became the eleventh U.S. state to legalize recreational use on Tuesday. Cannabis-related bills were considered in 25 state legislatures this year, including in New York and New Jersey, according to advocacy group Marijuana Policy Project.
In the U.S., cannabis remains illegal at the federal level. The drug is classified as a Schedule 1 substance with no medical value and a high potential for misuse.
Engel said the new National Cannabis Working Group is still determining its priorities. He hopes the group, which spans the financial, legal, construction and transportation sectors, will eventually guide policies that advance Canada’s cannabis interests globally.
“The primary aspect of it is really shaping public policy and decision making within Canada as a starting point. But I think the chamber of commerce in many aspects also does work closely with boards of trade, and works internationally,” he said. “It’s still early.”