Is CGC stock set to skyrocket off the back of the US's 2018 Farm Bill? Opportunity abounds for Canopy Growth Corp (TSX:WEED) (NYSE:CGC), the world's largest cannabis producer by market cap, as it can now enter the US market off the back of hemp.
Let's have a look!
CGC Stock: New Hemp Market
Last week, the US Senate and House of Representatives passed the 2018 Farm Bill. This legislation makes it legal across the country for farmers to grow industrial hemp. More specifically, it removes industrial hemp from the federal government's list of controlled substances.
As CBD oil is extracted from industrial hemp, Canopy Growth can now enter the legal CBD market with full force.
The new legislation is expected to take effect as of January 2019.
CGC Stock Can Enter US Market
The New York Stock Exchange (NYSE) and the Toronto Stock Exchange (TSE) prohibit their listed companies from engaging in federally illegal business. Because of this, Canopy Growth and many of its peers have been unable to enter the US cannabis market.
This is despite medical and recreational cannabis's legality at State levels.
However, now that hemp is to be legal at the federal level, the implications for CGC stock are huge.
Cannabis Growth
Because of this milestone, massive growth in the cannabis space is expected in 2019. And where it gets very interesting is when we consider CGC stock. As stated, before now, Canopy Growth was not able to enter the US cannabis market at all.
Now it can, and with it, CGC stock liquidity will also increase.
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CBD Market
Canopy Growth's CEO Bruce Linton has hinted that the company has already prepared itself for the milestone:
"I think hemp [legalization] is going to happen in the U.S. When it does, that's not the time to start. You should have already been started up and ramped up and [be] ready to revenue up. We think we are."
It would be silly not to expect Canopy Growth to launch hemp-derived CBD products in the US market. No doubt, CBD-infused drinks will be a priority release as Canopy Growth and its drinks partner Constellation Brands (NYSE:STZ) are already developing cannabis drinks for the Canadian market.
Keep an eye on CGC stock in early 2019 as Canopy Growth takes first steps into a projected $22 billion USD CBD market.
Featured Image: Depositphotos/© Kagenmi
