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Listen to the prophets of pot, and a brighter future for Canada’s cannabis industry is always just around the corner.

First, this great promise was the medicinal market. Then, it was full legalization of recreational pot. And, finally, it hinged on the rollout of a retail network.

We have all that now. But none of those key milestones has delivered big profits for the major publicly listed cannabis producers. Indeed, most are still losing a lot of money.

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So people in the industry are touting the next big thing: the edibles market. Apparently, the real money is not in feeling better or getting high. It’s in getting people to wash it down with brownies and gummy bears.

Among those talking up the boundless potential of edibles was Bruce Linton, the former co-chief executive and chairman of Canopy Growth Corp., Canada’s largest marijuana grower.

“[Edibles] is what we’re built for. It is the whole point of this exercise,” he told The Globe and Mail last month. “… It is the next big wave.”

Perhaps. But Mr. Linton won’t be riding it. He was ousted this week, not long after the company announced a larger than expected $323-million loss in the quarter ended in March.

For all of fiscal 2019, Canopy lost $670-million. More distressingly, its losses grew larger after recreational cannabis was legalized in Canada last October.

Other companies have followed a similar pattern. The more revenue they have, the more money they lose.

For years, Mr. Linton and others have been selling a very different story to investors.

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It’s unlikely that edibles will do for the industry what recreational and medicinal marijuana, so far, have not. Ottawa is slated to open up the edibles market by mid-October of this year, at the latest. The government has already published proposed rules. But they include a stricter per-serving limit on the psychoactive ingredient tetrahydrocannabinol (THC) than most industry players wanted.

That perhaps explains why the wizards of weed are now talking up global opportunities. They’re already looking past the launch of edibles to the day when Canada becomes a cannabis export giant, supplying the United States and other foreign markets.

They make the case that Canadian companies can become dominant global players. As the first major Western country to legalize marijuana, Canada has a huge head start. Thanks to investors, billions of dollars have been poured into research, cultivation, packaging, branding and distribution. The result is several well-capitalized producers, such as Canopy, with growing production capacity.

Cam Battley, chief corporate officer for Edmonton-based Aurora Cannabis, told The Globe recently that Canada is “leading the creation of a brand new global industry.”

But why Canada? Cultivation will inevitably cost more here than in warmer countries, making us an improbable global leader.

There is no assurance that getting to the market first will guarantee global success. Right now, the vast U.S. recreational market is closed to Canadian companies. They can’t sell to retailers there. It’s also closed to most U.S. companies, which generally can’t sell across state lines.

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Even if the U.S. eventually legalizes recreational marijuana nationwide, it’s not obvious what advantages Canadian producers would have.

Maybe Canada is just a Petri dish – a place where large international food and beverage companies get their feet wet, learning what to do, and what not to do. Several foreign companies have made big bets on Canadian cannabis companies. Constellation Brands Inc. (Corona and Robert Mondavi wine) owns 38 per cent of Canopy and controls the board. Anheuser-Busch InBev has a joint venture with Tilray Inc. Tobacco giant Altria Group Inc. has invested heavily in Cronos Group.

Constellation, for one, is apparently not happy with what it sees in Canada. Mr. Linton’s departure is a wake-up call, not just for Canopy, but for investors who have helped swell the market value of numerous other industry players to lofty heights.

Maybe it’s time for investors to pay a bit more attention to what’s actually happening in the market, rather than listening to the hype about the future.

They may soon realize that Canada’s cannabis market is small, highly regulated (as it must be) and vastly oversupplied.

That is typically not the kind of business environment where companies generate enormous profits – no matter what the prophets of pot might tell you.

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