Shares in all of Canada’s major listed cannabis companies surged on Tuesday, as the market reacted to Trudeau’s pledge to legalise recreational use

Among the biggest corporate winners from Justin Trudeau’s surprise victory in the Canadian election is the nation’s cannabis industry.

Shares in all of Canada’s major listed cannabis companies surged on Tuesday, as the market reacted to Trudeau’s pledge to legalise recreational cannabis use.

Canopy Growth Corp, the country’s biggest producer, saw its shares spike as high as 21% when the markets opened the morning after the Liberal’s victory party. Shares in the company, which owns medical marijuana brands Tweed and Bedrocan, had already risen by 29% in the past week.

Bruce Linton, chief executive of Canopy Growth, which claims to provide to 20% of Canada’s medical cannabis users, said: “I think what you’ll see perhaps, after this election … is a recognition that there is an opportunity to collect taxes on something that is already being sold into the market illegally or illicitly.”

Shares in the other big players in Canada’s cannabis industry Aphria Inc and Mettrum Health rose by 8.4% and 7.1%, respectively. Some other smaller weed companies’ shares rose by as much as 40%.

Aaron Salz, an analyst at Dundee Capital Markets, said: “Trudeau’s vow to legalise and regulate marijuana the ‘right way’ has set in motion the single most important catalyst for the marijuana space.”

Legalising cannabis had been a key plank of Trudeau’s campaign and he had promised to work towards legalising it “right away”. “We don’t yet know exactly what rate we’re going to be taxing it, how we’re going to control it, or whether it will happen in the first months, within the first year, or whether it’s going to take a year or two to kick in,” he said in the run-up to Monday night’s vote.

Trudeau said legalising and regulating cannabis – in a similar way to how it is controlled in Colorado, Washington, Oregon, Alaska and DC – would actually make it easier to prevent children from accessing the drug and give tax revenues a big boost. He said current laws were “making marijuana too easy to access for our kids, and at the same time funding street crime, organised gangs and gun runners”.

The Liberal party’s official position on cannabis states: “We will legalise, regulate, and restrict access to marijuana. Canada’s current system of marijuana prohibition does not work. It does not prevent young people from using marijuana and too many Canadians end up with criminal records for possessing small amounts of the drug.

“To ensure that we keep marijuana out of the hands of children, and the profits out of the hands of criminals, we will legalise, regulate, and restrict access to marijuana.”

If Trudeau follows through on his pledge, Canada would become the first big country to fully legalise the cultivation, sale and recreational use of cannabis. The only country to have made cannabis fully legal is Uruguay, but the 2014 law has yet to be fully implemented. Other countries, like the Netherlands, Germany and Spain, have very relaxed enforcement on cannabis but its use is not fully legalised.