The U.S. Has faced a difficult month, with social issues erupting in nationwide protests meanwhile the corona-virus is still on the prowl.
The demonstrations spilled out to the majority of the western world, including our own Australia. The cannabis industry was not immune. Plenty of U.S. Brick and mortar businesses suffered from looting and property damages in the aftermath of rioting.
Medical Cannabis News
A revolutionary new type of cannabis edible is being manufactured in Australia. Company iX Syrnix has come up with a wafer-type technology, made for medical use. The technology, patented as WaferiX, is ingested by being placed under the tongue. These fine people are developing a range of medicinal cannabis products and saw a strong interest in the wafers after the initial production run completely sold out.
“The iX sublingual technology offers a fixed-unit dosing, predictable absorption and rapid onset of action. This will overcome some of the absorption issues faced by other delivery methods.” iX CMO Dr Janakan Krishnarajah said.
We saw the Australian government legalise medicinal cannabis purely through prescription in 2016. Meanwhile, the interest in medicinal cannabis has grown healthily. In 2019, it was reported the number of patients prescribed grew by 658%, and as of April 2020, the Therapeutic Goods Administration (TGA) has approved more than 12,000 special access applications for medicinal cannabis products. Not bad.
Cannabis News Australia
In other news, new laws took effect on January 31st this year, allowing the personal use of weed in the ACT. Here are the notes:
– It's now legal for any adult to possess marijuana (up to 50 grams maximum). – Selling or supplying cannabis is still a criminal offence in Australia. – Each adult can grow two cannabis plants per household. – Each household is limited to 150 grams of “wet” cannabis.
Looking south, the largest medicinal cannabis extraction and manufacturing plant costing $50 million will be built at a secret location in Melbourne’s south-east. Secret? That's no hyperbole. The location is completely undisclosed. The facility will be owned by The Valens Company, local to Canada, however, the hiring and equipment side is being managed by Australian distributor, Cannvalate. Like something out of a Hollywood film, it will be a 4500 square metre facility, they will have double perimeter fences, 24/7 CCTV monitoring, and a vault where the finished goods will be stored.
“It will be very, very secure,” said Cannvalate chief executive, Sud Agarwal.
Cannabis & Culture
Beginning earlier this year, the Victoria Legal & Social Issues Committee - under the Legislative Council - released an ‘Inquiry into the use of Cannabis’. Committee chair Fiona Patten stating, “We’re interested in hearing people’s views on whether use of cannabis should remain legal for medical treatment only or whether current restrictions on use of cannabis should be changed,”. Could Victoria be heading towards legislation similar to ACT? You can enter your submission here.
An interview with Greens leader Adam Bandt revealed the party wants to create a legalised and regulated market for cannabis, proposing a new federal agency that would be a buyer and wholesaler for recreational cannabis.
He stated, “People would also be able to grow a small number of plants for their own personal use, but the government would be the one in charge of buying and selling”.
Over 20% of U.S. citizens live in a state where cannabis is legal for recreational purposes, and Canada federally legalised it in 2018.
“The world didn't end when countries legalised the use of cannabis” he exclaims.
Bandt hopes after the next federal election, the country has a “situation like Canberra”, where Greens and Labor were able to create reform in the ACT. He also claims they have a bill currently in parliament, and with some positive input from other parties, it could be done in a matter of months. He also makes a point that other parties are soft-peddling on the issue.
Cannabis in Finance
Whilst the world is still in recovery from COVID-19, AND despite protests, U.S. Stock Markets for cannabis companies have moved upward with momentum:
- The ETFMG Alternative Harvest ETF - Gained 36%.
- AdvisorShares Pure Cannabis ETF - Gained 42%.
- Cannabis ETF - Gained 45% (From May-June).
Cannabis stocks are up by 40-odd-per cent across the board. But there's more to this story. For those “not into” the world of stocks, this kind of looks like a boring mess of data. For those who love finance, reading this is amazing! Right? Unfortunately, this isn't accurately representing growth in the cannabis industry.
Thanks to something called “Unlimited amount of cash”, a term coined by the Federal Reserve's President Neel Kashkari in response to the Corona-virus economic downturn in March, The FED has printed up to 6 trillion dollars for support. A large portion of this cash is provided as liquidity to Funds like BlackRock and JP Morgan Chase, to be used to support the markets from a major disaster. So nope, that growth in cannabis stocks surely can't be considered legitimate growth in the industry. It might suggest there is some confidence in cannabis stocks by people in charge. However, we need American workers back behind their desks first. I mean, the country is still under lockdown. It's a very complicated time, and the economic issues are complicated. You won't find any financial advice in this article.
As far as Australian cannabis stocks go, the majority of top players were stagnant throughout May. However, the CANN Group, located in Melbourne, pulled off a 25% gain, (potentially) thanks to new supply agreements allowing the export of medicinal cannabis products into the U.K. And Europe.
Hey! That's some good news after all.
With drug laws still crunching down on the sale of cannabis in Australia, the majority of our publicly listed cannabis companies are still on the speculative side of the Australian Stock Exchange.
The Wrap Up
As poorly as the western world seems to be performing, there is a light at the end of the tunnel for the cannabis industry after the COVID-19 crisis. Cannabis stocks are at least seeing support from American funds, and Australians can look forward to the personal use of weed in the ACT, as well as large projects in development in Melbourne.
But what do you think? We'd love to hear something we missed, so make sure to leave us a comment below.
Stocks Data courtesy of TradingView