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Cannabis Industry Eyes Newly Opened German Market

Cannabis Industry Eyes Newly Opened German Market

The decriminalization of marijuana in Germany, Europe’s largest economy, is expected to boost demand for medical cannabis and create new opportunities for B.C. growers and producers.

Cannabis growers and producers in B.C. are eager to enter or expand their exports to the German market following the implementation of Germany’s new marijuana decriminalization law on April 1. The law legalizes possession of up to 25 grams of marijuana for recreational use and allows individuals to grow up to three plants for personal consumption. Additionally, cannabis is no longer classified as a narcotic, enabling any doctor to prescribe it.

"This significant change impacts cannabis growers in Canada and B.C.," said Deepak Anand, principal of ASDA Consultancy Services in Vancouver.

Although Canadian companies are restricted from exporting recreational cannabis globally, many have been selling medical cannabis to countries like Germany. With a population of over 84 million, Germany's new law is expected to increase the number of medical cannabis prescriptions.

"The medical cannabis market in Germany is expected to grow exponentially," Anand noted. "This is likely to have the biggest positive impact on cannabis cultivators, growers, and businesses in Canada and B.C."

Pure Sunfarms, a leading cannabis producer in B.C., has been exporting medical cannabis to Germany since 2023. The company received European Union good manufacturing practice (GMP) certification in 2022, allowing it to export to EU markets.

"The German cannabis market is central to our international strategy," said Paul Furfaro, senior vice president of strategy at Village Farms International Inc., the parent company of Pure Sunfarms. "Our strains have been well received by medical patients in Germany, and demand continues to grow."

Following decriminalization, some B.C. cannabis companies, such as Herbal Dispatch Inc., are planning to expand to the German market. Herbal Dispatch CEO Philip Campbell is set to attend a cannabis conference in Germany to secure export deals, aiming to sell to the market in the second half of 2024.

"There's a lot of interest in the German market now," Campbell said. "People are excited."

B.C. cannabis companies are well-positioned to benefit from the expanding German market. Due to high cultivation costs in Germany, many products are expected to be imported from Canada.

Canada is already the largest exporter of medical cannabis to Germany. In the first half of 2021, Canada exported 2,882 kilograms of cannabis oil and flower to Germany, surpassing the Netherlands, the second-largest exporter.

B.C. cannabis products have also entered other global markets. Herbal Dispatch started exporting to Portugal and Australia last year, with exports growing significantly. The company plans to increase its exports to 3,000 to 5,000 kilograms this year, representing 30% to 40% of total revenue.

"B.C. has a global reputation for producing high-quality cannabis products," Campbell said. "The Canadian market is the most advanced from a global trade perspective, providing a strong competitive advantage."

Herbal Dispatch is now looking to export to Germany, the Czech Republic, and Thailand, aiming to secure export deals that could account for 10% to 15% of total export sales this year.

Anand highlighted that Germany could learn from Canada’s experience with cannabis legalization. The new legislation opens up opportunities for collaboration and talent exchange between the two countries.