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VANCOUVER — Retailers across Canada are struggling with a shortage of all cannabis, but there’s one product they’re especially desperate to keep on shelves: cannabidiol or CBD, a non-intoxicating extract vaunted for its purported health benefits.

The extract, most commonly sold as oil, has been promoted as a natural cure for pain, anxiety and insomnia, despite limited medical research. Many customers are coming in asking for it, especially first-time and older users, store owners say.

“I don’t think the licensed producers really realized how popular CBD was, so there’s none available, really,” said Krystian Wetulani, founder of City Cannabis Co. in Vancouver.

“When something becomes available on the cannabis wholesale ordering sheet, everybody tries to get all that’s available. It’s like a race. That’s one of the biggest opportunities we’re facing in the legalized market.”

Companies are ramping up hemp growth to produce the trendy extract, but observers expect the shortage to persist until late this year. Meanwhile, scientists are working to separate the hype from reality when it comes to medical claims about the drug.

While licensed producers were preparing for legalization last year, they assumed most of the demand was going to be for cannabis high in THC, the intoxicating ingredient, said Khurram Malik, CEO of Biome Grow.

The buzz around CBD grew with the passage last year of a U.S. law known as the farm bill, which allows for the growing of hemp for the purposes of extracting cannabidiol, he said. Similar regulations came into effect in Canada in October.

But it was the U.S. law that drove up media coverage and social-media influencer chatter, Malik said. Kim Kardashian West recently posted on Instagram about her “CBD baby shower,” where she invited guests to make cannabidiol-infused salt scrubs and body oil.

“Because of the farm bill passing, the sexiness or the in-vogue profile of CBD went through the roof,” said Malik. “The demand side just blew up and caught everyone by surprise, on both sides of the border.”

Extracting CBD from hemp, which is low-THC and high-CBD, is more affordable because the crop can be grown outdoors on a large scale under Canadian rules that are less restrictive than those for producing high-THC marijuana, Malik said.

Biome Grow has partnered with CBD Acres, which Malik said will supply his company with up to 20,000 kilograms of cannabidiol concentrate annually in order to serve Canadian and international markets.

The CBD shortage affects jurisdictions across Canada, said provincial distributors in British Columbia, Nova Scotia and Newfoundland and Labrador.

“There has been a significant learning curve for licensed producers as they transition into supplying a new market,” said B.C.’s Liquor Distribution Branch in a statement. “Licensed producers are working towards becoming more efficient, however many of their expansion projects have not yet been fully ramped up.”

The branch added it expects supply to increase in the second half of 2019 as expansions come online and more producers receive licences to enter the marketplace.

Beverley Ware, a spokeswoman for the Nova Scotia Liquor Corp., said while it has “CBD leaning” products, it has not been able to consistently carry pure CBD oil due to the national shortage.

Customers looking for CBD products would prefer not to smoke them and don’t want the added THC, said Darrell Smith, spokesman for the Newfoundland and Labrador Liquor Corp.

“It has been a challenge to source a steady supply of these products as they are often reserved for the medical cannabis community,” he said.

Ivan Ross Vrana, cannabis adviser at Hill+Knowlton Strategies, said he didn’t think that producers failed to anticipate the high demand for CBD.

“I think what the industry, given its newness, is grappling with — and a lot of companies are getting a good handle on — is about consistently growing the product that consumers want,” he said.

“It’s not easy. I know people think, ‘It’s just a weed. We can grow this no problem.’ It’s not. You’re still growing a plant and Mother Nature has a large say in that.”

The legalization of edibles, extracts and topicals later this year is likely to further ramp up demand, Ross Vrana said. CBD-infused creams, beverages, food and even pain-relief products for pets are expected to be growing market segments.

Despite the hype, research into the health benefits of cannabidiol has been fairly limited, said Dr. Gabriella Gobbi, a psychiatrist at McGill University who has studied the drug.

Gobbi’s team published a study in the journal Pain last October that pinpointed the effective dose of CBD for safe relief of pain and anxiety. The U.S. Food and Drug Administration has also approved a CBD drug to treat children with severe epilepsy.

But more research is still needed, particularly on CBD’s effects on anxiety and insomnia, Gobbi said.

Some patients who try it experience no effects and studies have also indicated a placebo effect in some people with anxiety, depression and pain, she added.

“Today there is a dominant culture of cannabis, a dominant culture of everything that is natural is good. This is why … cannabidiol is so popular.”

A proposal for a marijuana-grow operation in Langley is drawing opposition because it would sit next to a bird and wildlife area that has been protected for years, as well as a long-running, addiction recovery facility.

Glen Valley Cannabis Ltd. is waiting to get its federal licences and is applying to the Township of Langley for building permits. It has vowed to keep a lid on odours and use blackout blinds to mitigate the impact of its facilities.

But neighbours and others aren’t convinced.

“This is such as new industry,” said Rhyan Thomas, a spokesperson for the Glen Valley Neighbourhood Coalition. “What we have seen in terms of greenhouse operations that grow cannabis is that they say they are going to put in the controls, but the effects of what they put in don’t help enough.”

This is “rural neighbourhood with lots of smaller hobby farms,” said Thomas. “We are used to different forms of farm smells and tractors. The concern is that this proposed operation would be smack in the middle of a delicate area. It is right across from the Blaauw Eco Forest and just a few metres from the Wagner Hills Farm Society.”

Thomas said the eco-forest is a “remnant of an ancient forest. It has a wetland component with an aquifer that is under threat with dropping water levels.”

Some years ago the Blaauw family donated the 35-acre eco-forest so that its rare, cedar woodlands and bog wetland with diverse plant and animal species could be studied and preserved. Janet Wiens, daughter of Ann Blaauw, who donated the property in 2013, is concerned that questions from the scientific community about the cannabis operation’s potential impact on the “draw on the aquifer” aren’t being answered.

“If it dries up, the plants and animals in the wetland and bog will simply vanish,” said Thomas.

The Wagner Hills Farm Society has, for decades, been operating as a farm, market and rehabilitation centre for men and women. Intake and care-plan manager Brandon Anderson is also calling for a halt to the project. There is worry that the smell of cannabis production wafting over could undermine its programs. Clients under their care are “vulnerable adults due to their addiction illness, and by law, should be given special consideration and protection.”

The owners of Glen Valley Cannabis have said they will be running a boutique-like operation as opposed to larger ones that have been cited as dire comparisons.

But Thomas said the property the company owns is 38 acres in size so it is small now, but “with (that size land) to work with, the concern is that it can evolve into a larger operation.”

The Township of Langley’s manager of permit, licence and inspection services didn’t respond to queries for comment.

Cam Battley believes that in the not-too-distant future, his company — one of Canada’s largest licensed producers — will be exporting a “significant chunk” of the cannabis it is growing domestically.

“We have a massive market over in Europe, even in Latin America,” says Battley, chief corporate officer at Aurora Cannabis Inc. “These countries are legalizing medicinal cannabis one by one but they’re not growing as much as us. They’re going to need product, and we’ve already got the ball rolling on exporting.”

It’s a sentiment shared by other major producers here, many of which are spending tens of millions of dollars to build up international footholds with the intent of being key players in the emerging global cannabis industry. But before they can make good on those ambitions, some things will have to change.

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That’s because when it comes to international trade, cannabis isn’t just any other product.

Under the Cannabis Act, Canadian producers are currently only allowed to export weed for medical use, and then only to countries that allow cannabis to be imported.

When it comes to recreational cannabis, the rules are ever more strict: a number of international treaties fundamentally ban the movement of cannabis for recreational purposes, regardless of the domestic legal status of cannabis in specific nation.

“Where the rubber hits the road for domestic cannabis producers is that international trade is largely restricted. And my view is that that is unlikely to change in the next five to seven years at least,” says Martha Harrison, a partner at McCarthy Tetrault LLP who specializes in international trade and investment law.

Canada is signatory to three international treaties that prohibit the movement of cannabis for recreational purposes — the 1961 Single Convention on Narcotic Drugs, the Convention on Psychotropic Substances (1971) and the UN Convention Against Illicit Traffic in Narcotic Drugs and Psychotropic Substances, ratified in 1988. Under those treaties, Health Canada has an obligation to restrict the movement of cannabis to “medical and scientific purposes between countries.”

Earlier this year, the World Health Organization, citing new research touting the medical benefits of cannabis made headlines for calling for the removal of the drug from Schedule IV of the 1961 convention, the most restrictive category, which contains Class A drugs such as cocaine and heroin.

But the United Nations has yet to follow through, due in part to the organization’s historically conservative stance on drugs.

“The UN is kind of in an awkward position. They don’t want to dilute controls on marijuana because it would be viewed by some members are diluting controls on all narcotics. It’s kind of that slippery slope argument that you see in governments that are against legalizing marijuana,” says Adams Lee, an international trade lawyer at global law firm Harris Bricken.

According to Harrison, until the UN or the WHO reclassify cannabis and products containing THC outside the scope of international treaties, cannabis trade will be limited.

Nevertheless, a handful of large Canadian cannabis producers such as Aurora, Tilray Inc., Canopy Growth Corp., and Aphria Inc., remain bullish on the prospects for international cannabis trade.

Tilray recently announced the opening of a cultivation facility in Portugal that it says will feed medical demand in Europe and both Aurora and Canopy Growth have large production hubs in Denmark for similar reasons.

While the producers say they are aiming to serve medical markets, these facilities have enough capacity to eventually meet a significant portion of Europe’s demand for recreational cannabis — if and when cannabis is ever permitted to be moved across borders for non-medical purposes.

Harris Bricken’s Lee calls the industry’s optimism “a little bit too rosy.” But, he adds, if Canadian companies want to position themselves as first movers, projecting the “best-case scenario” to investors, then their investments abroad “perhaps make sense.”

“We know that the demand will be there internationally. And right now, we have a significant advantage because American cannabis companies cannot export their product,” says Battley.

Canada’s edge stems from the fact that U.S. federal guidelines continue to classify cannabis as a Schedule 1 drug, making it ineligible for export.

Until that changes (assuming it does), Europeans who consume cannabis for medical reasons will continue to get a taste of Canadian weed.

Canada’s major licensed producers currently export thousands of kilograms of cannabis to supply medicinal markets in countries that lack cultivation capacity.

And as Canadian production of cannabis has ramped up, so have cannabis exports: Since 2015, when it became legal to trade cannabis for medical purposes, shipments of dried cannabis have tripled.

Most this product goes to Germany, a country of 82 million people, where cannabis is legal for medical use and insured by the government as part of its national pharmacare program.

Producers only need an export permit from Health Canada and a import permit from the German government in order to begin their shipments.

“We’ve gotten good at this, we’re able to get our permits on both sides in under 30 days,” says Battley, who credits Aurora’s German branch (Aurora Deutschland) with administering the trade process.

Harrison, for her part, believes that the scenario most likely to have a domino effect on the international trade of cannabis is if countries begin reclassifying cannabidiol (CBD) as a permitted medical ingredient in the same vein that ingredients in natural health products are. “Based on industry intelligence, I can say that the trade on CBD oil is going to open up in a quicker and more fluid way that recreational cannabis.”

“That’s going to engender a larger regime shift in how governments and international bodies view the movement of cannabis globally. It’ll be good if Canada can lead the way on that.”