Germany imported a record amount of medical cannabis in 2020, but its relationship with exporters is shifting

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A new report notes that Germany set a record by importing nearly 10,000 kilograms of medical cannabis in 2020, but its relationship with exporters is beginning to change as more countries sign supply agreements and domestic production ramps up.

From 2018 to 2019, the amount of medical cannabis imports grew by 100 per cent, but increased only 37 per cent in 2020, according to new analysis from Prohibition Partners, a global cannabis market intelligence firm.

German Chancellor Angela Merkel’s centre-right Christian Democratic Union (CDU) is contemplating legalization, which would make it one of few countries in the world to do so and signify a major about-face for the conservative party.

Germany has relied on the Netherlands and Canada for much of its cannabis in recent years, but importation from the Netherlands fell by five per cent in 2020, as additional countries, including Uruguay, Spain, Austria and Israel, began exporting medical cannabis to the country.

In its analysis, Prohibition Partners predicts that the balance of supply will continue to shift away from the Netherlands and Canada in favour of countries with lower production costs. Domestic cultivation is also a factor, with Germany expected to supply at least 2,600 kg of cannabis per year, and potentially much more than that, in the future.

Some of Canada’s largest licenced producers have supply agreements in place with Germany, including Canopy Growth, Aphria, Aurora, Cronos Group and others.

Earlier this month, Aphria announced it was on track to be the first licensed producer to grow medical cannabis in Germany, with its first harvest expected to occur in the coming months.

“In Germany, we are leveraging our strong medical platform and our multifaceted international operation, which combines in-country cultivation, import permits and large distribution infrastructure to increase access and availability to high-quality, consistent medical cannabis for patients,” Aphria chairman and CEO Irwin Simon said in a press release.

The company also announced that its chief strategy officer, Denise Faltischek, had assumed the role of managing director of Aphria Germany.

“In establishing our international footprint in Germany, we invested in the completion of our in-country cultivation facility and distribution network in Neumünster,” Simon said. 

In addition to Aphria, Aurora Cannabis and German company Demecan grow medical cannabis in the country of 83 million.

It its most recent financial report, Canopy Growth noted its dried flower sales in Germany fell two per cent year-over-year in the third quarter, citing supply challenges and COVID-19 restrictions hampering market growth.

Recreational cannabis remains illegal in Germany, but medical use has been permitted since 2017 and CBD products are widely available.

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