Canadian cannabis companies are increasingly turning to the international medical cannabis market, seeing exports increase by 50% last year.
Declining domestic medical cannabis sales and an increasingly competitive adult-use market are forcing licensed producers to look overseas to supplement their income, according to a new report from MJBizDaily.
In the fiscal year 2022-2023, C$160m worth of medical cannabis products were exported from Canada, up from C$107 in the previous period.
Meanwhile, domestic sales from April 1, 2022, to March 31, 2023 were C$401m representing a 9% year-on-year decline, and a 20% drop compared to two years earlier.
CEO of Hyde Advisory & Investments David Hyde told the publication that these medical exports are set to continue to increase ‘for the next two or three years, at least’.
He added that the growing prevalence of vape and hash, or ‘cannabis 2.0’ products, could see these exports pivot away from flower.
Alongside new products, some experts believe the growth in higher quality ‘craft’ cannabis was helping drive exports higher.
The number of craft producers operating from micro-cultivation facilities has increased from 179 to 423 over the last two years, but many of these producers have a limited path to the export market.
Deepak Anand, principal of ASDA Consultancy Services in Surrey, British Columbia, says that this is beginning to change.
“A lot of the crafts and micros, because their licenses are only cultivation and not processing, they don’t have the ability to export cannabis,” he said.
“So they are now basically connecting with companies like Herbal Dispatch, as an example (to help facilitate those exports). That’s the future, because a lot of people don’t want product from big companies, whereas the craft guys have great products but they don’t have the certification.”