There is no question about it – brewing giants are getting into the business of marijuana. Just last year, Constellation Brands, maker of Corona and Modelo, invested millions into the design of cannabis-infused beverages to be sold on the Canadian market. Heineken-owned Lagunitas has also jumped in with its IPA-inspired, THC-infused sparkling water Hi-Fi Hops. This brew is now available in California.
But now, Molson Coors has joined the ganja game. The second largest brewing company in the U.S. and Canada announced earlier this week that it had officially partnered with Hydropothecary Corporation to develop a line of THC-infused, non-alcoholic beverages that it plans to sell in the northern nation later next year.
The brewery told investors during a recent earning call that it was considering a move into marijuana, but had not yet made an official determination. Company executives said the decision to move forward was a matter of “do we want to be a spectators or a participant.”
Canada recently legalized a nationwide recreational pot market. It is set to get underway in October of this year. However, edible cannabis products, which include THC-infused drinks, will not be allowed on dispensary shelves until sometime in 2019. The law only allows the distribution of smokeable forms of marijuana until then.
“Canada is breaking new ground in the cannabis sector and, as one of the country’s leading beverage companies, Molson Coors Canada has a unique opportunity to participate in this exciting and rapidly expanding consumer segment,” Frederic Landtmeters, president and CEO of Molson Coors Canada, said in a statement.
“This new venture is consistent with our growth strategy and our commitment to being first choice for consumers and customers by ensuring that Canadians have access to high-quality products that meet their evolving drinking preferences.”
Beer companies getting into marijuana is a no-brainer. The recent decline in domestic sales as more customers spend money on craft beer and hard liquor has given major brewers no choice but to expand or die. Even Anheuser-Busch, the largest brewer in the world has felt the hit. In fact, the company, while not yet making a move to cannabis, has indicated that it plans to put more focus on its non-alcoholic beverage line to attract the Millennials and those deemed Generation Z that are no longer consuming alcohol with as much enthusiasm as those who came before them.
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In reality, all of the brewing companies dabbling in the Canadian cannabis industry are just preparing for the time when the United States government finally ends marijuana prohibition. Molson Coors Brewing CEO Mark Hunter says the Canadian deal is intended to be a “test” for products that could one day be available all across the Land of the Free.
“We believe potentially it’s got really significant potential and we’re going to learn a lot,” Hunter said. “If other markets start to open up in due course and this becomes federally legal, then we’ll be in a good place at that point in time.”