Europe isn’t the only export opportunity for this Canadian grower.
This is the week the entire legal cannabis industry has been waiting for. On Thursday, June 7, Canada’s Senate will vote on bill C-45, likely approving it, and moving the Cannabis Act (as it’s best known) one step closer to becoming law. By sometime later this month, Canada could become the first developed country in the world to have legalized recreational marijuana.
Should the votes fall as believed, adult-use legalization would open the door to legal sales beginning in August or September. In total, this legalization is expected to add $5 billion in annual sales to Canada’s weed industry, once fully ramped up.
Marijuana growers look abroad for opportunity
But, truth be told, the Canadian cannabis industry is looking well beyond its domestic borders for opportunity. Even though Health Canada has estimated that domestic demand could hit 1 million kilograms of cannabis per year, it’s overseas markets that could be responsible for even greater aggregate demand. In fact, by 2020, yours truly has estimated that combined production could hit 2.4 million kilograms in Canada, creating a surplus of well over 1 million kilograms. Growers are counting on export agreements with the more than two dozen countries around the globe that’ve legalized medical weed to completely offset this oversupply.
In most instances, these medical marijuana-legal markets are located throughout Europe. Countries like Germany, which have come to embrace the potentially therapeutic effects of cannabidiol oil and dried cannabis, have virtually no domestic growing operations. Thus, they are almost wholly reliant on imports to meet patient and physician demand. Aside from Canada, only the Netherlands, Uruguay, Australia (via a recently passed measure), and perhaps soon Israel are in the market of exporting dried cannabis.
This major pot company has its eyes on Africa
There are market opportunities that exist beyond Europe. Aphria (NASDAQOTH:APHQF) is one such major Canadian pot player that’s turning its attention to Africa’s burgeoning cannabis industry.
According to a recent United Nation’s survey, and per CNN, more than 10,000 tons of marijuana (that’s more than 9 million kilograms) are produced on the African continent each year, which would be worth billions upon billions of dollars if a wave of African countries were to legalize access to medical marijuana.