After delaying REC retail six months, then spending the subsequent nine months handing out a tiny number of REC licenses to citizens selected at random by lottery, the province of Ontario is ready to start over on REC retail.

On Monday, an unlimited number of aspiring REC retailers may apply for Retail Store Authorizations (store licenses) the Alcohol and Gaming Commission of Ontario will begin giving out in April. It has set a floor of awarding five licenses per week. Cannabis Retailer

Various REC retail chains are lining up to enter the Ontario market.

Six former employees of Toronto's first REC retail store, the Hunny Pot, told Vice they endured an intolerable work environment where "the safety [and] happiness of workers, anything to do with their people, it was completely second thought." Vice

In December, REC retail sales across the country increased 8% over November for $146M in sales, which would represent $1.75B annualized, compared with last year's total $1.2B sales. Cannabis Retailer, BNN Bloomberg, Financial Post

• In December, Ontario sold $33.69M in REC at retail stores ($2.31 in sales per person), while Quebec sold $33.46M ($3.94 per person).
• BC sales declined 7%, to $17.79M ($3.50 per person).
• Cowen analyst Vivien Azer said the firm had cut its 2020 sales projection back to $3.5B, 32% below its most recent projection. BNN Bloomberg

A new survey from market-research firm Mintel found two thirds of non-users open to trying cannabis said they were interested in edibles and beverages. Ingestibles were the form of cannabis most attractive to new consumers. Among Mintel's respondents (from a survey last fall), 59% were either already cannabis consumers, or were interested, and 32% said they were "open to trying it." NewsWire, Twitter—Deepak Anand, David George-Cosh

A BC reviewer making an unboxing video of Aurora's Daily Special value brand's opened the 15 gram package to discover it contained only 7.94 grams. Youtube

Some reviewers and insiders discussed creating "do not buy" lists of legal REC products they don't feel meet minimum quality standards. Twitter—Dianna Donnelly, WhatsMyPot

Brock University business professor Michael J Armstrong explained last week's reports of the same REC products being sold for as much as twice the price from one province to another by focusing on differences in provincial wholesale markups on REC products in provincial annual financial statements. CBC Toronto, The Conversation

• In the 2018-19 year, Quebec's average markup was 23%, while Ontario's was 77%.
• Markups aren't the only additional costs—there are also federal and provincial taxes and costs.  Twitter—Michael J Armstrong
• Armstrong also upbraided Statistics Canada for producing estimates on quarterly cannabis sales that "have been accurate to roughly +/- 35%, 19 times out of 20."Twitter—Michael J Armstrong

• Alberta predicted its provincial online-and-wholesale REC monopoly business will lose money over the next three years, with $36M in losses this year, $25M in fiscal 2021, and $24M in fiscal 2022. Twitter—David George-Cosh
• Activist Dana Larsen and those planning Vancouver's 4/20 event aim to bring it back to its protest roots with a theme of "No More Drug War" and a list of twelve demands for changes to cannabis policy. The Straight
• Vancouver will soon table controversial bylaws regulating cannabis-industry emissions, which some farmers outside cannabis say threaten the entire provincial agriculture sector by threatening  to impose limits based on opinions of smells rather than measurable harmful emissions like methane. Mugglehead

Cronos announced it would delay its Q4 and full-year reporting, but did not explain why, except to say it had suffered a delay in finishing its financial statements. CBC Business, The Star

• Cronos's largest shareholder is Marlboro parent Altria, which paid $2.4B for 45% of Cronos stock. Cronos is now worth roughly $2.3B.

Extractors didn't have as rough a year as cultivators, which explains why Valens celebrated financials featuring Q4 revenue of $30.6M and $17.7M in adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). As BNN Bloomberg's David George-Cosh said, a profitable quarter is "a rarity in the pot industry." NewsWire, BNN Bloomberg

Cowen downgraded Tilray, Aurora, and Sundial from "outperform" to "market perform," though Cantor Fitzgerald's Pablo Zuanic is still optimistic Aurora's on the mend. Business Insider, Seeking Alpha, MarketWatch

EY's Ashley Chiu tweeted the "Common misconception [is] that all [publicly held companies] have an effective internal control environment. The reality is that only NYSE and NASDAQ requires listed companies to prove that their [internal control over financial reporting] and governance programs are effective. Other exchanges [only] provide guidance and suggestions." Twitter—Ashely Chiu

• Chiu warned me this summer not to presume that because someone's listed on the Canadian Securities Exchange, they necessarily have, for example, a legal department. "Or even a lawyer," she joked ominously.

Alberta REC retailer 420 Investments (parent of Four20 Premium Markets) sued Tilray for $110M for breach of contract after Tilray "had a change of heart and no longer wished to proceed" with acquire 11 Four20 Premium Market locations in Alberta for $110M in cash and stock. BNN Bloomberg

As of November, Health Canada has licensed 15.2M square feet of indoor and greenhouse production (up 8% over October), and 20M square feet outdoors (no increase for now, but 100 more outdoor applicants are in line).

• That's up from 10M square feet total in July 2018 and 2M square feet in 2017. However, as Health Canada's David Brown noted, it's unclear how much of that space is "actually being used as canopy and how much is still just 'funded capacity.' Twitter—Matt Lamers, MJ Biz Daily David Brown
• Cannabis ranks fourth among harvested area of greenhouse crops across the country, with 1.4M square metres—more than lettuce (200,000), but less than cucumbers (4.6M). Twitter—Matt Lamers

Cannabis At Work founder Alison McMahon predicted recruiting will increase in the space at both the executive and managerial levels. LinkedIn  

Nasdaq added three indices of Canadian cannabis prices, indicating that cannabis is approaching tradable-commodity status. MJ Observer, BNN Bloomberg  

Think your LP might be the subject of a class-action lawsuit? You might want to start by reading this. Norton Rose Fulbright Blog

The federal Business Development Bank of Canada (BDC) continues to refuse to do business with any Canadian companies that work directly with the cannabis plant. Inside the Jar

• In a letter to a client, the bank said, "Businesses supporting the cannabis industry that do not own or physically handle cannabis are eligible for services from BDC. More specifically, general contractors, equipment manufacturers, horticultural and other equipment/product suppliers are eligible.
• "For now, businesses cultivating or selling cannabis (medical or recreational) are ineligible for BDC financing. This includes activities such as cultivation, production, testing, processing, transformation, packaging, distribution, import/export, or selling (wholesale or retail)."

Last June, the bank said it would not fund businesses "involved in the transformation, cultivation and production of cannabis," though they said they would "review [their] position over time based on industry developments." Twitter—BDC  

Quick Hits

1. Conservative leadership candidate Peter MacKay may not agree with legalization, but he's not going to repeal it. He'd wants you to know he thinks the Liberals did it terribly, though. Inside the Jar, CBC Politics
2. As of the beginning of February, the parole board of Canada said 343 of the 500,000 Canadians with criminal records for cannabis possession have applied to have their records suspended. Only 196 of the applications have been accepted. Press Progress, La Presse—In French

• However (contrary to the CBC report), the device cannot measure cannabis impairment, only the presence of THC in the blood.
• Impaired driving lawyer Kyla Lee lambasted the device as "technology that will never be tested by anyone independent of government." Twitter-Kyla Lee

Quick Hits

1. A judge from the Manitoba Court of Queen's Bench found the Winnipeg Police Service deliberately damaged growing equipment belonging to a man growing MED at home with an expired Health Canada license. The judge demanded police pay $3,500 in damages. CBC Winnipeg

Patient and MED advocate Ashley Keenan noted in a Leafly piece that with REC legalization has come excise tax on MED, a dosage limit for edibles, and a trend of landlords and condo boards to harden anti-cannabis rules. Leafly

• Trina Fraser countered that legalization also struck down storage limits for those producing their own MED, made MED documents transferable between LPs, eased registration renewal processing, and removed purchase restrictions. Twitter—Trina Fraser

Health Canada is getting some MED research projects licensed, at long last. Inside the Jar

The Canadian Centre for Substance Use and Addiction (CCSA), which opposed legalization, published a series of  infographics. One about medications that "can interact with cannabis," warned of interactions with 13 common medication types, including OTC products. MED advocates were unimpressed.

• The CCSA has previously claimed cannabis use was related to over 850 deaths in 2014, and also argued that it was only a "hypothesis" that alcohol was more toxic to the body than cannabis. Daily Hive, Maclean's

• Jon Liedtke, co-founder of Windsor's Higher Limits lounge weighed the pros and cons of edibles-only consumption lounges based on his experiences running a smoking/vaping café  in an engaging Twitter thread.

Quick Hits

1. Former chef Nicholas Nedin is host of the Flower Hour podcast and he makes the best edibles I've ever tasted. You're probably going to want to get his cannabutter recipe. Inside the Jar
2. Turns out not all rolling papers are vegetarian. News to me (a vegetarian). Her(b) Life