New Beer Standards In Canada Could Lead To Big Profit With Marijuana-Infused Brews

June 28, 2018

The slogan “this Bud’s for you” could take on a slightly different connotation: if proposed new standards by the Canadian government go through, brewers throughout the country could be required to list all ingredients on the label, while also opening up the potential for more herbs and spices to enter the fray. Beer would also be defined based on its sugar content and additives.

Could cannabis beer, similar to this one from Germany, be a lucrative market for Canadian brewers?(Photo by Carsten Koall/Getty Images)

According to The Government of Canada, the proposals are meant to change the standards by:

(1) reducing duplication by having one compositional standard for all types of beers regardless of style, and one source of information for food additives;

(2) expanding the definition of beer to allow for the use of new ingredients and flavoring preparations to enable innovation and better reflect market developments;

(3) maintaining the integrity of beer by setting objective measures; and

(4) clarifying existing requirements to reduce inconsistencies.

The standards have already undergone one round of comments from the public and industry last year. According to the Canadian Food Inspection Agency (CFIA), there were three major areas at the time that drew mixed reaction: mandatory barley or wheat malt in the definition (supported by the majority of brewers), the 4 per cent limit in weight of sugar (which drew criticism that it could “exclude some styles of beer, hinder craft beer development and creativity, and may have trade implications”, and requiring labels to include allergens, which was supported except by those who felt that consumers would already know that beer contains barley or wheat malt.

Beer is big business in Canada, with $9.1 billion in sales in 2016, accounting for 40.6 per cent of total sales of alcoholic beverages in 2016/2017, according to Statistics Canada. The shift comes at a time when another potentially profitable substance comes to the market on Canadian shelves, due to the coming legalization of marijuana later this year. Smaller brewers such as those at Toronto-based “highly disruptive premium adult beverage company” Province Brands have been experimenting with brewing using the marijuana plant itself (carefully testing it outside of Canadian borders).  

In Winnipeg, Manitoba, cannabis company Delta 9 and Fort Garry Brewing recently released a cheekily named Legal Lager, a THC-free alcoholic brew made with hemp seeds. The companies are also in the process of developing a Phase 2 product that will contain cannabis, but no alcohol, but are biding their time until pot becomes legal (the product is currently only available internally as a concept beer). 

Vancouver-based Faculty Brewing Co., along with Northern Vine Laboratories, Abbatis Bioceuticals Corp., have also signed on to develop a THC-free but cannabinoid-rich beer to get the company in line for production when the new legislation is announced. It’s not just small brewers that are thinking green. Larger companies such as Molson-Coors are also reportedly amongst those poised to take on the potentially lucrative market, as is Constellation Brands, who invested in a Canadian cannabis company last year. 

It remains to be seen whether the new standard, proposed to start in 2019, will dovetail with the legalization of marijuana in Canada to create a new type of product category, or whether these dreams will disappear in a puff of smoke.