How to Find Good Cannabis Suppliers in Europe

You can buy and sell cannabis in Europe without going to prison. But finding good cannabis suppliers in Europe might be more difficult than you think.

Now, before you get too excited and require a joint to relax, you should know that only cannabis with a tetrahydrocannabinol (THC) concentration lower than 0.2 percent is legal throughout the European Union. This might shatter your stoner dreams, but the cannabis you can legally buy in the EU right now will not get you high.

Related: How to Buy Legal Cannabis Online in Europe

But don’t let that small detail smother your enthusiasm. The legal cannabis industry in Europe is estimated to be worth about €123 billion by 2028, so it’s still a market worth looking into.

You might be wondering why good cannabis suppliers are still difficult to find when the European cannabis industry has so much potential. Well, we’ll discuss the reasons at length in the following article.

 

The European patchwork cannabis regulatory system

Even though Europe is expected to become one of the most profitable cannabis markets — if not the most profitable market — in the world, the current situation doesn’t look too promising for investors. One of the main reasons entrepreneurs are not investing in the European cannabis market is the region’s inconsistent regulation system.

Some countries, like Switzerland, Austria, Belgium, Luxembourg, Germany and the Netherlands, are taking steps towards establishing clear and concise regulations regarding cannabis, which encourages companies to invest in this market sector.

On the other hand, some other strong economies in Europe, such as France and Italy, are not progressing towards creating a clear legal status for cannabis or are even taking steps backwards from organising a profitable habitat for cannabis businesses.

Related: All You Need To Know About CBD Regulations In Europe

Despite being home to some of the largest hemp fields in Europe, France still has one of the harshest legislative regulations regarding cannabis in the EU. In Italy, a ruling of the Court of Cassation in May 2019, made the commercialisation of Cannabis sativa derivatives — notably oils, resins, leaves and buds — illegal. This ruling affected about 2,000 cannabis businesses operating on Italian territory.

That being said, most European states legalised or are planning to legalise medical marijuana in the near future. Thanks to the legalisation of recreational and medical marijuana in some North American and European states, some governments might understand that legalising cannabis can boost the local industry and help the economy.

 

The European cannabis supply vacuum

Some European countries legalised the use of medical marijuana as a treatment for severe maladies, such as cancer, multiple sclerosis, AIDS and more. But you might be wondering how patients in these countries get their hands on cannabis if growing it is often illegal.

Well, the answer is simple. Most countries currently heavily rely on imports to cover their local needs. And, as the demand for high-quality cannabis rises in Europe, North American growers are stepping up to fill the vacuum in the market.

Canada and the United States now embrace the cannabis culture and produce marijuana at a scale you wouldn’t have thought possible just five years ago. The Canadian cannabis industry will be worth around 11 billion Canadian dollars (€7.47 billion) in the next six years, while the U.S. cannabis industry is predicted to be worth about $66.3 billion (€59.7 billion) in 2025.

Related: European Cannabis Discourse Is Mostly Canadian, and That’s a Problem

The experience and funds of the North American growers are often a gross advantage over their European counterparts. This was easy to see in Germany when the Canada-based companies Aurora and Aphria outbid their competitors and won 10 out of the 13 lots allocated by the German state.

In fact, even the bid’s requirements — that the participating companies respect the UN treaty of Single Convention on Narcotics and Dangerous Drugs — made it easier for foreign companies to win. One of the conditions was that the applicants have previous experience in supplying high-quality cannabis to a regulated market. As you can imagine, this condition immediately eliminated nearly all German suppliers, as they couldn’t have previous experience since the German legal system forbade growing and selling cannabis.

The same treaty prohibited U.S. companies from bidding, as it only accounts for countries that legalised the production and distribution of previously prohibited drugs, not individual states within a country.

Why external imports will continue to dominate the European cannabis market

Even though Germany is taking steps towards building a local cannabis-growing industry, the country’s current demand is still too high to be covered without imports. According to Georg Wurth, the CEO of the German Hemp Association, the 200 kg of cannabis per year that should come from the state-allocated lots will not be enough to avoid bottlenecks in the German cannabis supply.

And this situation is happening across the continent, in every country that prescribes medical marijuana. As the European demand for cannabis soars, the local regulations will significantly affect the cannabis supply chain. As a result, prices will most likely rise, making cannabis prescriptions even less appealing to health insurance companies than they already are.

Related: Canadian Cannabis Suppliers Need European Markets

Canada will most likely continue to be a crucial player in this process, as more and more Canadian investors are coming to Europe.

Canadian companies have a huge advantage of operating in a free market. Canada has legalised cannabis for recreational purposes, and cannabis businesses are now able to access capital by going public, opening crowdfunding projects and, of course, seeking partners for investments abroad.

 

Steps towards a Europe-based cannabis supply

The Netherlands might also rise to the occasion and start covering some of the European demand with the help of local farmers.

After going to Canada to see how a completely legal cannabis supply system operates, ten Dutch municipalities will be taking part in a trial where all the coffeeshops operating on their territory will be supplied by local, regulated growers. The experiment will last four years, and it aims to control the strength of the cannabis that is consumed in coffeeshops as well as to reduce cannabis-related criminality.

Even though Dutch coffeeshops are renowned worldwide for their cannabis-friendly menus, they operate in a grey legal area. At the moment, the Dutch legal system tolerates the personal use of cannabis, but commercial cultivation is illegal. This forces the coffeeshops to rely solely on imports or, as it’s often the case, to rely on a criminal supply chain.

And the Netherlands is not the only EU member state looking to build a regulated cannabis supply chain. Bulgaria is also taking small steps towards establishing itself as a safe haven for cannabis entrepreneurs.

Bulgaria has issued an authorisation for a company to sell products containing hemp-derived cannabidiol (CBD) in open markets. This opens a significant economic opportunity for Bulgaria, but it’s also a step that supports the current trend of acceptance of cannabis within the EU.

CBD is now considered as a ‘novel food’, and some EU member states outright banned its production and commercialisation. Bulgaria is the first country to move in the opposite direction, allowing the free sale of CBD. This move should encourage entrepreneurs to invest in the Bulgarian cannabis industry.

Related: CBD is Still a Novel Food in Germany

Denmark is another country that is seeking to grow its own cannabis stash. In April 2019, the Danish government granted 23 authorisations to companies that want to cultivate and handle cannabis, while 12 more applications are still pending.

The authorisation of local companies to grow cannabis was a logical next step for the Danish government, as the Canada-based companies Canopy Growth and Aurora Cannabis already invested in production centres in Denmark, and are hoping to get a saleable harvest by the end of the year.

 

The challenges of becoming a cannabis supplier in Europe

Entering the European cannabis market is more complicated than you would think. In fact, this process is so complicated that some U.S.-based companies have given up on that thought altogether. If a company wants to produce in the EU or export cannabis to an EU member state, its products have to GMP and ISO certifications in the EU as well as in the company’s country of origin.

After getting the certifications, the producer has to receive an approval or import licence from every EU member state the company plans on operating in. Sometimes, an individual import licence is required for each individual product or strain.

Related: How to get a Cannabis Growing Licence in the EU

And the process doesn’t get any easier, even after getting all the licences and approvals. Since cannabis is not legal for recreational purposes, it’s considered as a medical device. As such, the producer cannot sell cannabis-based products in dispensaries or headshops but has to sell it through a pharmacy instead.

To make matters worse, the only way to get a product into a pharmacy based in an EU member state is through a pharmaceutical wholesaler. Now, this is where things can become very complicated.  Medical cannabis is still a novelty, even in countries that legalised its use several years ago. As a result, most distributors will not touch the stuff, let alone sign a contract to sell it to pharmacies.

Finding a distributor willing to work with cannabis is so difficult that the Canadian giant Canopy Growth bought wholesale distribution companies in both Germany and the Czech Republic to supply its own needs.

So unless you run a successful multi-million- or billion-dollar company, entering the European cannabis supply chain might be difficult, indeed.

 

The rise of the European CBD market

But cannabis means more than medical or recreational marijuana. Cannabis-derived products such as CBD are taking the European health and wellness market by storm.

CBD is now world-renowned for the beneficial effects it can have on the human body, especially for its potential ability to alleviate anxiety and relieve chronic pain. The European CBD market’s worth is estimated at €450 million, representing about 31 percent of the global market.

Now, CBD suppliers have some advantages over other cannabis entrepreneurs. For one, CBD can be extracted from hemp, and hemp cultivation is legal in the EU as long as the plant’s THC content is lower than 0.2 percent. This allows hemp farmers to increase the profitability of their harvest, as they can process the plant for CBD as well as for its stalks or seeds.

Related: Europe is Reaping the Benefits of CBD’s Entrance Into Wellness

Another advantage is that the European CBD market is riding on the coattails of the North American one. CBD is hot and trendy right now in the U.S. and Canada, which means it’s trendy in most of western Europe as well. European consumers who are interested in health and wellness surely learned about the benefits of CBD as soon as the substance hit the American shelves.

CBD products containing less than 0.2 percent of THC are also legal in the EU, so consumers can easily buy them online. In fact, there are a lot of businesses already capitalising on this opportunity.

According to the Brightfield Group, a market intelligence firm focusing on the cannabis industry, the European CBD market is expected to grow by over 400 percent until 2023.

However, because cannabidiol is now included on the novel foods list, CBD suppliers will have to jump through multiple hoops before being able to access the market. New CBD products now have to pass pre-market tests that can cost up to €300,000, which might discourage startups from trying to enter the market.

 

Final thoughts on how to find good cannabis suppliers in Europe

Every day, new cannabis businesses try to enter the European cannabis supply chain. At the moment, this market sector is in full bloom, and there’s a place for everyone, no matter how large or small.

Since entering the cannabis supply chain is a difficult and costly process, most companies that manage to sell their products on the European market want to uphold their standards and attract new customers, so as to not lose their reputation and customer base.

As you can imagine, not everyone currently operating in the market is legit. If you want to make sure that your cannabis supplier is trustworthy, you should check out if the company offers a third-party lab analysis for its products, and whether it is mentioned on the Internet in other places than on its own websites. Seeking out your cannabis supplier on cannabis review websites such as Weedmaps is a good place to start.

But let’s end on a positive note. The North American investments in European cannabis, along with the increasing public interest and the expansion of medical cannabis programs within the EU will surely convince the European lawmakers that establishing a clear legislative foundation will only encourage companies to invest into this market.

Related: United Nations to Improve Cannabis Laws, US May Not

Having clear legislation concerning cannabis products in the EU should help to weed out the low-quality products and allow businesses that sell high-quality products to thrive.

Leave a Reply

Your email address will not be published.