How the HollyWeed Extraction Agreement Will Benefit Canopy Growth

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Value-added products

Canopy Growth (WEED) (CGC) aims to launch an array of products to serve a variety of customer tastes and preferences. These products will include cannabis-infused products, which will require cannabis oil extracts. Such product differentiation will result in the company’s ability to charge a premium on its offerings. Its agreement with HollyWeed will help it inch closer to this objective

In a press release, Bruce Linton, chair and co-CEO of Canopy Growth, stated, “The cannabis resin we get from HollyWeed will be used for our current offering of oils and softgels, as well as our future advanced manufacturing products.” He added, “Oil and resin will be essential for our entry into the edibles market and supports our overall goal of making a wide variety of high-quality products available to our customers.”

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Dried cannabis

Linton had previously indicated that the dried flower would continue to command a premium—that is, it wouldn’t become a commodity—because consumers want good-quality products to maintain a certain social status among users.

High-quality derivative products will likely be a key focus for Canopy’s peers (MJ) HEXO Corp. (HEXO), Tilray (TLRY), and CannTrust (CTST).

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