Cannabis is a “big business,” and Constellation Brands has big aspirations in the space, the alcohol beverage company’s president said this week.
Officials for Constellation Brands (NYSE: STZ) have their sights on developing unique cannabis-based beverages for sale in markets around the globe, as laws allow, Bill Newlands, Constellation’s chief operating officer and newly appointed president told investors Wednesday. Newlands presented as part of the Consumer Analyst Group of New York’s annual conference.
“This is very consistent with what our organization has done historically, which is to identify, meet and stay ahead of evolving consumer trends,” Newlands said, according to a transcript of the presentation obtained via Bloomberg.
“Our goal with this organization is to work collaboratively to both understand the cannabis business but also develop unique cannabis-based beverages that will be available around the world as legalities prove those to be an option,” he said.
First up: Canopy’s homeland of Canada.
“Let me remind all of you, cannabis is going to be legal in Canada starting (this year), and we expect the beverages will be legal soon thereafter,” he said, according to the transcript.
“And let’s keep in mind,” he added, “this is a big business.”
Rattling off the numbers of U.S. states that have legalized the medical use and/or the recreational use of marijuana, Newlands stated that by Constellation’s estimate, cannabis is a $50 billion business in America.
“That’s half the size of the beer business,” he said. “That’s pretty big business.”
Newlands was quick to give the caveat that Constellation has no intention of entering into the U.S. cannabis industry unless cannabis is legal “at all levels of government.”
Canopy Growth and Constellation already have kicked off research-and-development work, The Canadian Press recently reported.
“Cannabis edibles (including cannabis-infused beverages) will not be legal in Canada until 2019,” Caitlin O’Hara, a Canopy Growth spokeswoman said via email to The Cannabist. “That said, we are already preparing for the opportunity to brand and market these products, once federal regulations permit.”
The cannabis industry’s rapid expansion and projected future growth is increasingly attracting interest from well-established, traditional businesses such as Constellation, Scotts Miracle-Gro and, most recently, leaf tobacco merchant Alliance One International. As first reported by New Cannabis Ventures, Alliance One acquired majority stakes in a North Carolina industrial hemp firm that extracts cannabidiol, or CBD, as well as two Canadian marijuana firms.