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Canada’s most populous province to more than triple weed outlets

Posted On: Jul. 5, 2019 8:34 AM CST

Marijuana in Toronto

(Reuters) — Ontario’s government announced plans on Wednesday to issue 50 new cannabis retail licenses, which would more than triple the total number of privately owned brick-and-mortar cannabis stores in Canada’s most populous province.

The move comes as a result of “marginal improvements in the national supply” of cannabis, Ontario’s Minister of Finance Rod Phillips said in a press release. The new stores are expected to open by October 2019.

Canada became the first developed country to legalize cannabis last year, but sales and tax revenues have been pressured by supply constraints and prices that are higher than those on the black market.

Ontario’s new government had initially intended to open government-run cannabis stores, similar to how liquor is sold in the province, but changed its mind just a few months before legalization came into effect and instead allowed privately owned businesses.

The lottery will open in July 2019. It is not clear when outcomes will be known. If all 50 licenses are successfully issued, it would take Ontario’s total store count to 72. That would translate to one store per roughly 200,000 people in the province.

“While the federal supply issues persist, we cannot in good conscience issue an unlimited number of license to businesses,” said Ontario Attorney General Doug Downey. “A phased-in approach remains necessary.”

Thirteen of the new licenses announced on Wednesday will be allocated to stores opening in Toronto, with another six in the Greater Toronto Area. Twenty-three licenses will be spread out across the rest of the province.

Eight of the 50 licenses are set aside for retailers wishing to open on Indigenous reserves, part of the provincial government’s efforts to “engage with First Nations interested in developing their own approaches to cannabis,” said the government press release.

The licensing for these stores will take place through a separate first-come-first-served process.

The opening of Ontario’s first legal cannabis stores in April 2019 was marred by setbacks, with only 10 of the approved 25 stores meeting all the criteria to open by the April 1 deadline.