According to the latest data, are Canadians trading alcohol for cannabis?

Jeremy Bouvet
According to the latest data, are Canadians trading alcohol for cannabis?

Canadians are shifting their consumption habits, as recent data from Statistics Canada reveals a notable decrease in alcohol purchases alongside a significant increase in recreational cannabis sales. The fiscal year 2022 to 2023 saw a noteworthy surge in cannabis spending, reaching $4.7 billion, marking a $0.6 billion increase from the previous year. This trend indicates a consistent rise since the legalization of recreational cannabis in 2018, with each legal-aged Canadian spending an average of $150 annually on cannabis products.

Conversely, alcohol sales have experienced a consecutive decline for the second year in a row. Statistics Canada reports a 1.1 percent decrease in alcohol sales by volume, amounting to 3,106 million liters in 2022/2023. Notably, the average consumption of alcoholic beverages per legal-aged Canadian has reduced to 9.2 standard drinks per week, down from 9.5 in the previous year. Beer sales, specifically, have hit a historic low since tracking began in 1949, with an average of 3.6 standard bottles consumed per week per legal-aged person in 2022/2023. However, despite the decline in volume, alcohol revenue has risen by 2.8 percent due to increased prices, according to StatCan.

Wine sales have also seen a downturn, with a 3.0 percent decrease in purchases compared to the previous year. This decline has resulted in wine's market share dropping to 29.9 percent, its lowest level since 2010/2011. In contrast, the cider and cooler category witnessed a modest increase in sales by volume, albeit significantly smaller compared to previous years.

The surge in recreational cannabis sales is primarily attributed to inhaled cannabis extracts, which experienced a remarkable 59 percent increase in 2022/2023. Newfoundland and Labrador stood out with the highest growth in inhaled extracts sales, attributed to the reversal of its ban on the category in 2022. Despite dried cannabis remaining the most popular type, its sales decreased to 64.9 percent, indicating a shift towards other forms of consumption.

In terms of government revenue, recreational cannabis sales saw a substantial increase of 24.2 percent compared to the previous fiscal year, while alcohol sales experienced a marginal 0.1 percent bump. However, despite the growth in cannabis revenues, total alcohol sales revenue in Canada still significantly surpasses cannabis revenues, totaling $13.6 billion and $1.9 billion, respectively.

In summary, the data suggests a noticeable trend towards reduced alcohol consumption among Canadians, accompanied by a significant increase in recreational cannabis purchases. This shift reflects changing consumer preferences and attitudes towards substance use, with cannabis emerging as a notable alternative to traditional alcoholic beverages.

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