Canada and the United States (U.S.) enjoy the world’s most comprehensive trading relationship with nearly $2.7 billion USD worth of goods and services crossing the border each day in 2023.
They also also have a significant investment relationship. The U.S. is the single greatest investor in Canada and Canada was the largest source of foreign direct investment in the US at the end of 2022.
Given the long-standing relationship between the two countries, it is clear that the cannabis industry stands to benefit from a collaborative environment, especially if the U.S. Drug Enforcement Administration (DEA) reschedules cannabis from Schedule I of the U.S. Controlled Substances Act (CSA) to schedule III of the CSA. The decision on the proposal is expected in 2025.
Rescheduling cannabis in the U.S. will lead to immediate opportunities within the U.S. domestic market, which in turn will open up greater cross-border opportunities within the North American cannabis market.
For example, new cross-border opportunities would include:
- Investment opportunities (especially in markets that have distressed assets)
- High-level research and development
- New pathways for pharmaceuticals, nutraceuticals and natural health products
- Increase trade (export/import) opportunities for a wide range of products
- Increased supply chain options around white labeling, packaging, storage and whole-sale distribution across North America
- Product and brand expansion in both markets
The value of the combined U.S./Canadian market is worth an estimated $37 billion USD in 2024 while the compound annual growth rate will be approximately 12% between 2024 and 2030.
For U.S. investors, the Canadian cannabis industry is especially attractive within the North American context. Since 2013, the industry has been developing and maturing. While there have been hard lessons learned, those operations that are still functioning today have a long track record of navigating a complex regulatory environment.
The Canadian market is still evolving and given Diplomat Consulting (Canada) and Leaf Street Strategies (U.S.) extensive experience in both developing each of their country’s respective marketplaces, we are uniquely positioned to capture emerging opportunities across North America.
Our proven success demonstrates what actions and policies lead to lucrative outcomes in the marketplace. For more information on how to seize this opportunity, visit Diplomat Consulting and Leaf Street Strategies. See our brief below for more details:
