Alberta recently announced plans to stop licensing cannabis retailers until Canada's cannabis supply shortage has been resolved—a move some US experts think is the wrong way for the Canadian province to approach the issue.
At the end of November, the Alberta Gaming, Liquor and Cannabis Commission (AGLC), which regulates the province's cannabis industry, said they would temporarily stop issuing licenses for new pot shops. The AGLC says they made that move because the province simply can't get enough cannabis to supply any more stores. But some US experts say all the moratorium will do is bolster the black market.
"It is absolutely idiotic—they're artificially inflating the price and reinforcing the black market," Dr. Jim MacRae - a Seattle-based cannabis industry analyst - told the Calgary Herald. "Government dragging its feet is feeding that unregulated market…I'm sure much smaller than 50 percent of the cannabis produced is going through the [legal] market."
And he's not the only one who thinks halting the licensing process is a huge mistake. Dan Rowland - a Denver-based business advisor for the cannabis industry - has called the AGLC's move "extreme measures" for dealing with the supply shortages. He said Colorado faced some supply issues when the legal cannabis market was launched in 2013, but the state "never backed off licensing of stores." Rowland believes it should be up to the individual business owners to decide whether or not they can deal with the supply issue.
"If this is going to be a privately run system, let them explore that opportunity," he said.
Rowland also levelled criticism at the Canadian federal government for their part in this nationwide problem. Governments, he says, always underestimate the demand and therefore don't put enough resources in to ensuring there will be sufficient supply for the market.
The AGLC is sticking to their decision, however, and spokesperson Chara Goodings says the licensing block serves to protect Alberta's 65 current cannabis retailers.
"If we hadn't [suspended licensing] there'd still be nothing to sell, so it'd still go to the black market," said Gooding. "We want to make everyone have a viable business."
Alberta's plan to stop handing out licenses for the time being was also criticized by people looking to get into the new industry. The AGLC is currently in talks with a number of licensed cannabis producers to see what they can do about increasing supply.