Many See Europe – Not the US – as the Big Market in the Coming Decade

'Very, very rich market': Why top Canadian marijuana companies all have their eyes on EuropeMonday Futurewatch – Four major Canadian cannabis companies announced quarterly results last week, but the future of those companies is perhaps the bigger story. All four are eyeing expansion into Europe where the market could grow to over $150 billion (CAD) by 2030. This is higher than the projected market in the United States, which one analyst pegged at about $75 billion (USD). Currently, the cannabis market in Europe is doubling in size every two years.

Aurora Cannabis Inc., for example, has 10 subsidiaries around the world – and five of them are in Europe. Pan-European company Aurora Europe will oversee operations in Germany, Denmark, Malta, Poland, and Italy. “The EU [is] going to be very, a very rich market for us,” chief corporate officer Cam Battley told analysts.

These types of global operations will likely be a network of integrated companies, which each specializing in niche markets. This is similar to tech-based companies like Xerox and Lockheed Martin, which conduct R&D at some facilities while others are sales and marketing. For example, Tilray Inc. is creating a global network of producers and marketers. “Tilray Portugal will focus on supplying the global medical market, primarily in the EU. Tilray Germany and Tilray Australia and New Zealand are similar in that they focus on importing products and on sales and marketing,” said CEO Brendan Kennedy.

Cronos Group Inc. and Canopy Growth Corp. also have expansion plans for the European cannabis market. “I think Europe is actually the most, or almost the most, exciting activity going on. So we’ve been busy in Germany,” said Canopy CEO Bruce Linton. “I think we’ve had about 1,000 pharmacies in Germany move our product and we’re now in the process of seeking approval for upgraded formats of the product. We have plants in the ground in a couple of countries in Europe already in greenhouses.”

Canadian Creating the Global Gold Standard of Cannabis Production

It’s clear that the Canadian cannabis market in itself will be relatively small. However, legalization of cannabis in Canada provides Canadian companies with a distinct advantage as the new world market grows. Early market experience, strict regulations, a large enough domestic market to launch a successful business, and legal ability to conduct medical research and strain experimentation will all contribute to Canada creating the Gold Standard of cannabis production.

This editorial content from the LPC News Editor is meant to provide analysis, insight, and perspective on current news articles. To read the source article this commentary is based upon, please click on the link below.

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  1. Captain Dred

    We aren’t the gold standard now, and we never will be. The companies mentioned above all have terrible product compared to what has traditionally been available in Canada. So long as our laws keep out the growers that made our industry, we will never come close to being the ‘gold standard’.

    Our BLACK MARKET is the gold standard, not our legal operations. The Licesned Producers of Canada use pesticides man. PESTICIDES. Sorry, the Canadian Experiment is a total Fail. They can’t even supply the Canadian demand for medical OR recreational cannabis. How is that leading the world? Maybe you should do some research on the state of Oregon. Clearly years ahead of us in all respects, and they have no problems meeting local OR global demand. They serve both markets already. We don’t, and can’t. Our shortages are expected to last years now.

    1. LPC News Editor

      Hi Captain Dred,

      There are a lot of factors when it comes to the perception of the “Gold Standard”, and you’ve hit upon some of them. Shortages, although regrettable, are not unexpected this early in the game, as touched upon in this article:

      LPC’s position is that the “Gold Standard” is a safe, secure, and legal cannabis cultivation system that does everything possible to keep cannabis out of the hands of illegal sellers and — especially — out of the hands of minors. The fact that Canadian companies are leading the way in the global market (such as in Europe, as discussed in this article) is further proof that they are forming the Gold Standard.

      We believe in safety above all. In the short term, quality and even supply may be sacrificed. But in the long term, it is our belief that quality and supply will bounce back within the confines of a strong, safe production system. It is this safe and reliable production system that foreign buyers and countries will trust.