Supreme Cannabis Scales Up Production & Into Higher Margin Product Lines -- CFN Media
March 27 2019 - 7:00AM
CFN Media Group (“CFN Media”), the leading agency and financial
media network dedicated to the North American cannabis industry
announces publication of an article featuring the Supreme
Cannabis Co. (TSX: FIRE) (OTCQX: SPRWF) (FRA: 53S1). The
company is a licensed producer with a 440,000 sq. ft. facility in
Kincardine, Ontario, recently secured Health Canada’s
approval for six additional flowering rooms. The new additions
bring its total square footage up to 180,000 sq. ft. across 18
flowering rooms.
Canada’s cannabis industry continues to experience a supply
shortage, according to Cowen & Co., which found that
nearly half of all items remained out of stock on five provincial
e-commerce websites. With the legalization of edibles expected in
October, these supply shortages could increase as the industry
broadens its customer base. These dynamics have created
opportunities for licensed producers expanding their production
capacity.
Ramping Up Production
Supreme Cannabis has 180,000 sq. ft. of production capacity
following Health Canada’s approval, which translates to an
estimated 26,250 kilograms per year—a 50 percent increase from its
prior production estimates. The company hopes to further expand its
production capacity to 50,000 kilograms per year, which would make
it one of the largest licensed producers in the country during a
critical supply shortage.
“With 18 of 25 flowering rooms at 7ACRES now approved by Health
Canada, production space at our facility is near the finish line,”
said Supreme Cannabis President and Founder John Fowler in the
press release announcing the expansion. “With our multi-award
winning 7ACRES brand now available in 8 out of 10 provinces, we
look forward to completing construction of the facility so that
cannabis enthusiasts coast to coast will be able to enjoy what we
believe to be the highest quality cannabis grown at scale in the
country.”
The company’s 7ACRES brand has received multiple cannabis
industry awards, including “Brand of the Year” at the
2018 Canadian Cannabis Awards. In addition, the company’s
provincial supply agreements consistently list the brand in the
highest brand category available to recreational consumers. The
company believes that premium categorizations are leading to higher
profit margins than many of their competitors that target the low
end of the market.
Launching Oil Products
Supreme Cannabis also announced that it expects to
launch cannabis oil products into the recreational market beginning
next month. Cannabis oil sales have been significantly outpacing
cannabis flower sales as the market matures. According
to Health Canada, licensed producers sold 4,455 kilograms of
cannabis oil to consumers in September 2018 (the last reported
data) compared to just 1,755 kilograms of cannabis flower.
“Premium oils require premium cannabis,” says Supreme Cannabis
CEO Navdeep Dhaliwal. “Our formulation will leverage supercritical
CO2 technology to produce a high quality, purified cannabis oil
which we reformulate with the naturally occurring cannabis terpenes
from our 7ACRES High-End Cannabis™. The result is a unique,
plant-based cannabis oil that carries the award-winning qualities
of our flower into an oil product for consumers looking for a
premium cannabis oil experience.”
The company plans to initially ship oil products to select
markets before expanding distribution of its cannabis oil line to
additional provinces by June 2019. Each bottle will contain a
proprietary blend of highly purified cannabis oils and terpenes
derived from plants grown by 7ACRES, which differs from the bulk
oils produced by many other cannabis oil manufacturers in Canada
and around the world.
Looking Ahead
Supreme Cannabis Co. (TSX: FIRE) (OTCQX: SPRWF) (FRA: 53S1)
is well positioned to capitalize on the growing demand for cannabis
across Canada. With growing production capacity and near-term plans
to enter the high-margin cannabis oil business, investors may want
to take a closer look at the stock over the coming quarters.
For more information, visit the company’s website
at www.supreme.ca.
Please follow the link to watch the full
interview: https://www.cannabisfn.com/supreme-cannabis-scales-up-production-into-higher-margin-product-lines/
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