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Cannabis Summary for June 10, 2021

2021-06-10 19:57 ET - Market Summary

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by Stockwatch Business Reporter

The S&P/TSX Cannabis Index lost 8.77 to 221.26, while the CSE Composite Index added 4.88 to 790.14. Canada's largest cannabis market, Ontario, will enter the first stage of its post-COVID-19 reopening plan tomorrow. The province has been in lockdown since November. While cannabis retailers have been allowed to offer on-line shopping, curbside pickup and delivery services, tomorrow will mark the first day in months that they can open for in-person sales.

The industry is hoping for a rapid sales boost. "As people start returning to stores, you're going to see demand start to increase," predicted chief financial officer Carl Merton of Tilray Inc. (TLRY: $24.23) at an industry conference this week. He said the lack of face-to-face contact with "budtenders" has stunted sales by reducing impulse buys and driving customers toward lower-priced (and lower-margin) products. More than 100 cannabis stores that have opened in Ontario over the last eight months have never had a customer set foot inside, by Mr. Merton's estimate. He called that "a real headwind-type experience" for Tilray and the other licensed producers (LPs) that supply those stores. Fortunately, he sees the "tailwind" picking up soon. While there may be a bit of inventory shuffling at stores in the immediate wake of the reopening, Mr. Merton expects orders to rebound "in the month to six-week period after that."

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