Metro cannabis producer’s target for today: Hong Kong

Company is the latest B.C. brand to attempt Asian market entry through retail channels

Cannabidiol-infused gummy products from Langley’s Pure Sunfarms will be included in gift sets available through Hong Kong retailer Lane Crawford |  submitted

A Metro Vancouver cannabis producer has secured a place for its cannabidiol (CBD) products in a major Hong Kong-based retail brand’s holiday gift set. 

Delta-based Pure Sunfarms’ deal represents a significant inroad for a B.C. company into Asia’s fledgling cannabis market.

The company said its partnership agreement with Hong Kong’s Altum International will allow it to include edible Pure Sunfarms gummys in gift sets from Found, the region’s first CBD café. The gift sets will be sold through Hong Kong retailer Lane Crawford.

Altum, which owns Found, is one of Asia’s most prominent CBD players.

The gift packages will be sold at pop-up shops inside Lane Crawford stores this holiday season, said Pure Sunfarms president and CEO Mandesh Dosanjh, who added that the company is looking foward to its brand’s first foray outside of Canada.

“We don’t know the full strategy of what’s coming next, but we do know that this was a great opportunity to give our brand international exposure for the first time – especially for elevating the profile of cannabis products.”

The Asian market has long been the lucrative prize for much of the cannabis industry, given the market’s large population, ample consumer dollars and tradition of supporting health and medicinal supplements that are produced from plants and other natural sources. However, several Asian countries are also known for their harsh anti-cannabis stance – given the links the plant’s image has to opium and other illegal drugs in the last century. Singapore, for example, has outlawed all cannabis products.

Other B.C. companies have attempted to tap into the Asia market through exploratory initiatives. Vancouver-based Better Plant Sciences Inc. (CSE:PLNT), formerly Yield Growth Corp., launched a number of interactive pop-up kiosks in Hong Kong in 2019 to promote its cannabis-infused beauty products.

But in the August press release announcing its name change, company CEO Penny White said Better Plant has shifted its business model to e-commerce and direct-to-consumer. She added that pursuing Asian retail markets is no longer feasible in the COVID age.

“We have made the decision to focus solely on driving sales within Canada and the U.S. for the foreseeable future, as the COVID-19 pandemic has made those distribution channels a more reliable option,” White said in her statement. “COVID-19 has also changed the outlook for retail channels worldwide, and our strategy reflects this.”

But Dosanjh said Pure Sunfarms has a significant advantage because Altum is a local player in Hong Kong that has been heavily promoting and educating consumers on behalf of the sector for more than a year.

“There needs to be education,” Dosanjh said, acknowledging that cannabis products still face an uphill battle in terms of social perception.

“That’s one of the main reasons for this partnership with Altum – because that education and the delivery of the information to the consumers have to be done through a trusted source at the local level. Altum has been able to start that dialogue through their stores instead of us going over to Asia to execute that.”

Altum’s Found café has been a major force on that front. The store, which offers coffees, biscuits, beer and fruit juices infused with CBD, has been offering consumers a taste of the substance’s therapeutic properties without the intoxication effect of tetrahydrocannabinol (THC) found in the cannabis plant.

Altum officials said in media reports that they chose Hong Kong in part because the city’s cannabinoid laws – especially around CBD – are more lax than places like Singapore.

Japan also allows CBD products as long as they don’t include THC; South Korea, Malaysia and Thailand allow the products for medical use only.

However, Dosanjh said his company currently has no plans to go beyond the gift set initiative in Hong Kong – let alone entering other Asian markets.

For markets where CBD is legal, cosmetics and consumables remain the most popular subsectors. Dosanjh said that’s why Pure Sunfarms chose the gummy to include in the Lane Crawford gift set.

Dosanjh said Pure Sunfarms’ entry into Hong Kong is “the beginning of the education, and it has been a slow process on their end in terms of introduction of products, and there is still a lot of work to be done. But for a well-known entity like Lane Crawford to do this, it says that there are consumers now looking for this product. This pop-up is a great start to give consumers the confidence that this is being done the right way.” •