European cannabis market estimated to be the most promising in terms of growth

In its latest study, the MarketsandMarkets's estimates that the global cannabis will rise from $10.3 billion in 2018 to $39.4 billion in 2023, with an average annual growth rate of 30.7 %. According to analysts, The European market will be the fastest-growing.

The future of the European market

Although recreational cannabis is not on the agenda in Europe (with the possible exception of in Luxembourg), medical cannabis has developed rapidly with each legalization, and the market is attracting bigwigs from across the Atlantic: Canopy Growth Corporation (Canada), Aurora Cannabis Inc (Canada), Tikun Olam (Israel), Cannabis Science Inc (US), Aphria Inc (Canada), Maricann Group Inc (Canada), Tilray Inc (Canada), VIVO Cannabis Inc (Canada), Medical Marijuana, Inc (US).

Each of these companies has taken steps in Europe, from simple knowledge-sharing contracts to the establishment of European subsidiaries, or even the construction of vertically integrated production structures. Some, like VIVO Cannabis, are already listed on the European stock exchange (Frankfurt). On the European side, the Danish producer Stenocare for the time being.

For the time being, the European market relies largely on imports, but many countries are preparing to welcome domestic production to secure their supply, and are inviting companies to apply for licenses and set up cultivation sites and production facilities on their territory. Recently, Greece has granted its first licenses for domestic production, and Malta is about to follow suit. In Germany, the process has been delayed (again) by legal means.

In a nutshell, the european market is the object of much anticipation. Canopy Growth has even announced plans to invest 100 million euros to strengthen their presence in Europe. The company has described Europe as «the most exciting market after Canada». Specifically, it is closely monitoring developments in Italy, Greece and Spain, where it would like to establish production hubs and then flood the European market. This is what Aurora and Aphria are planning to do in Malta..

The peculiarities of the European market are linked to the European Union's economic policies. Within the Union, standards are harmonized. If a plant complies with standards in one country, it complies with them throughout the Union. What's more, the Schengen area allows goods to circulate freely without customs duties, a boon for companies setting up shop there. Strategically, companies are able to reach a market of over 500 million consumers.

Other factors reinforce the attractiveness of the European market, such as the fact that the Mediterranean climates of southern Europe are conducive to outdoor cannabis cultivation, which means lower-cost production, or that the level of development of the euro zone guarantees high sales prices. In addition, the existence of national healthcare systems in many European countries guarantees high healthcare expenditure. Indeed, consumers are more inclined to spend on their health, as costs are partly reimbursed by the state.

France could play a key role in this market. A committee of experts convened by the Ministry of Health is currently discussing the appropriateness of legalizing medical cannabis. while French society already seems ready to welcome it with open arms. 82% of people in favor at last poll.