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Postal services ready for looming wave of legal cannabis deliveries

Medical marijuana is shown in Toronto on Nov. 5, 2017. THE CANADIAN PRESS/Graeme Roy

Legal cannabis is set to usher in a wave of high-value, age-restricted parcels in the mail system, and delivery companies say they’re ready.

The test of the system will come as Ontario relies entirely on the postal system for deliveries when pot is legalized on Wednesday while other provinces expect to see a fair portion of sales from online.

All provinces will require strict age verification of deliveries, but a combination of existing practices and new systems will help Purolator with the challenge, said Ramsey Mansour, vice-president of corporate strategy and marketing at the company.

“We have set up the appropriate technologies, training, and processes in place to be able to address this growing market. So we feel that we’re adequately prepared.”

Parcels will have to be sealed and not state they contain cannabis to reduce security risks, but they will be marked as needing age verification. Those delivering the packages will also be notified that an age check is required.

Purolator, which has contracts in place to deliver cannabis for Alberta and Prince Edward Island, already delivers medical cannabis for about half of the producers so it is familiar with the added demands of delivering the product, Mansour said.

The volume is only expected to make up a percentage in the low single digits of overall parcels, and shouldn’t bog down the system, he said.

“I consider the volume to be sizable, but in relation to the overall growth and our overall volume, not as substantial.”

Canada Post Corp. will be dealing with far more parcels as it has numerous agreements in place with Ontario, British Columbia, Alberta, Yukon, Nova Scotia, and Quebec.

While the company expects to see an increase in volumes, it will be able to handle it, assured spokesman Phil Legault by email.

“We have the capacity to handle any expected increase at this time.”

Canada Post has been delivering medical cannabis since 2013, but is still working to ensure those involved are trained ahead of legalization, said Legault.

“Our focus at this time is on ensuring our employees understand the expectations in terms of proof of age, handling the product from pickup to delivery and how to deliver safely.”

Canada Post declined to provide an estimate on expected volumes, but Quebec’s Societe des alcools du Quebec set a required capacity of between 20,000 to 30,000 parcels a week in its tender for delivery contracts.

The actual volume could well be different since it’s such an untested market, SAQ spokesman Mathieu Gaudreault said.

He said the SAQ expects about a third of cannabis sales to go online, but that they’ve been selling alcohol online since the early 2000s with Canada Post so already have experience with age verification.

“Obviously it’s a big concern for us, our mission is not a commercial mission, it’s a public health mission. So being able to have strict sales ethics is one of our main concerns.”

Security concerns about the high-value cargo are real, but no worse than for other pricey goods, said Lori Posluns, chief legal officer at Traffic Tech Inc, which does bulk medical marijuana deliveries and bid for the SAQ contract.

“There’s no issues. For us it’s business as usual and we do this every day. So whether the commodity is alcohol or cannabis or electronics or pharmaceuticals, everything’s high value.”

One of the biggest threats to deliveries is the overhang of a potential strike at Canada Post, where workers have been in a strike position since Sept. 26 after voting in late summer to support a walkout option.

Purolator, which is largely owned by Canada Post, declined to comment on whether it will be able to step in if a strike goes ahead.

Major U.S. delivery companies won’t necessarily be available to help step in.

United Parcel Service said that while it delivers medical cannabis within Canada it has no plans at this time to extend its service beyond that. Fedex’s service guide bans shipments of cannabis by default and a spokesman declined to say if the company makes exceptions.