Canopy Growth rises after cannabidiol product partnership with Martha Stewart
Canopy Growth Corp. (CGC) announced that Health Canada had granted an extraction license for its KeyLeaf Life Science facility in Canada. The company was trading 3% higher after the release of extraction license. The extraction license may add value to recreational products and also expand the company’s profit margins. As a result, Canopy can achieve profitability. In its document, the company said the capacity could increase its effectiveness and reduce its operating expenses of extraction. As a result, Canopy could introduce new products for cheaper costs into the market in Canada by the end of 2019.
The Canada-based company, which is a market leader in the cannabis space, has invested around US$ 4 Bn. Constellation Brands Inc. said that Smiths Falls which is a town in Eastern Ontario and recently permitted BC Tweed extraction site. It indicates, it has three notable extraction assets which support the growth of new products. The Saskatchewan office is anticipated to be online at the end of 2019. It can extract up to 5,000 kg of cannabis biomass or hemp per day. As per CEO Mark Zekulin, this license will ensure supply of extraction inputs for the medical, cannabidiol or CBD, and recreational markets, particularly the next generation of value-added, high margin cannabis products in Canada. Canada is focusing on offering edibles and different derivative products in this year.
As per the company’s news, Mark Zekulin appeared to be trying to calm investors. He stated, “With such a milestone, the company will be executing against the vision of making strategic investments to deliver results over the long period.” With the announcement, CGC also said that the extraction facility describes the plan for international expansion. The company may use the facility for developing hemp-based products for the USA. For instance, Aurora Cannabis Inc. (ACB) acquired Hempco Food and Fiber on 19th August 2019.