Canada legalized pot. Beer consumption there dropped.

"Volume decline accelerated in 2019, down 3% through November."

The new availability of a wide array of legal marijuana products has is beginning to take a bite out of beer consumption in Canada, reports Bloomberg News.

That's a big deal for a nation that prides itself in beer. What will Bob and Doug MacKenzie say?

Beer volumes fell by 3% through November, data from Beer Canada show.

"This is far worse than the trends seen between 2014-2018, where beer industry volumes fell an average 0.3%," and appears to be related to Canada's legalization of pot in late 2018, Cowen analyst Vivien Azer told Bloomberg News:

Domestic beer volumes slid 3.9% through November, while imported beer volumes grew 1.4%. Cannabis consumers appear to prefer mainstream beer "as they pursue better 'buzz for your buck,"' Azer said in a note published Tuesday.

There's some debate about how much impact marijuana legalization has on alcohol consumption, although surveys of pot users indicate that they tend to drink less when they're high. Declining sales have led to several alcohol-cannabis partnerships, including Constellation Brands Inc.'s investment in Canopy Growth Corp., Anheuser-Busch InBev NV's joint venture with Tilray Inc. and Molson Coors Brewing Co.'s partnership with Hexo Corp.

To be sure, the Canadian cannabis market is still tiny. Annual sales based on the most recent monthly data would be C$1.5 billion versus C$9.2 billion for beer and C$23 billion for alcohol.

Legal Pot Takes a Bite out of Beer Consumption in Canada [.bloomberg.com]