Canada Marijuana Industry Output Rises by 11% in May, Hits Year-to-Date High

Marijuana is becoming an increasingly important part of the Canadian economy. According to data released Friday by the government's Statistics Canada, the cannabis industry's economic production totaled contributed just over $8.65 billion Canadian ($6.45 billion) in May. That's the highest level recorded so far this year, topping the $8.32 billion ($6.20 billion) of March.

The May figure represented growth of 11% year over year and is in contrast to the country's gross domestic product (GDP) trajectory -- over the same stretch of time, GDP contracted by almost 14%.

Marijuana bud with Canadian flag in the background.

In fact, cannabis was one of the rare categories that saw an increase; finance and insurance (up 1.9%), Agriculture, forestry, fishing, and hunting (0.9%), and information and communication technology (0.7%) were some of the very few others.

The combination of marijuana's growth and the overall GDP contraction means the sector is contributing a higher percentage to the total, although it's still extremely modest. For May, that figure was 0.5%; in May 2019 it came in just below 0.4%. 

It should be noted that Statistics Canada's numbers include both licensed marijuana sales and those of black market sellers; a still-thriving market given the added costs of being fully legal. Although illicit sales are on the decline they remain considerable -- the agency estimated that they amounted to CA$3.92 billion ($2.92 billion), representing a 13% year-over-year decrease.

Despite the encouraging numbers, the stocks of Canadian marijuana companies slumped on Friday, in contrast to the gains enjoyed by the wider equities market. Canopy Growth (NYSE: CGC) slipped by 1.7%, Aurora Cannabis (NYSE: ACB) was down 3.3%, and Cronos Group (NASDAQ: CRON) fell 1.5%.