4/20 might have passed now, but our 4/20 specials are not over yet. Today, we focus on Europe with two Portuguese growers, a Spanish greenhouse supplier, and one of the leading Dutch seed suppliers.
Biggest challenge is to really regulate this industry
Portugal has been eyed by many North American companies as one of the best places to set up cultivations in the EU. Giants such as Clever Leaves or Tilray, for instance, have already stepped into the country, in the hope of getting the first-mover advantage to tap into a nascent market. Yet, such a thing is more easily said than done, as Portugal has one of the strictest regulations for cannabis companies. “INFRAMED, the Portuguese medicine authority, is ultra-strict,” says Sofia Ferreira with Sabores Purpura. “There are a lot of authorizations you need before you hit the ground. It’s a long process to get the license here, but that also means that we have a lot more quality products.”
Regulations might be super strict, but that allows the whole Portuguese MMJ industry to have a more streamlined approach to releasing products. “There are a lot of products that are in the process of getting approved within the next few months,” Sofia continues. “When our quality products hit the market, we as a country will also be able to make a statement about the quality of the cannabis we grow here. It’s good for the patients, but it’s also good for our export market.”
At the same time, regulations need to be fine-tuned so to better reflect the full extent of the cannabis industry. “There are a lot of discussions between hemp growers and medicinal cannabis growers. As an industry, we should all get together, and work towards the same goal, that is providing patients with high quality, consistent medicine.”
A lot of (not-so) hidden potential
Portuguese grower Cannprisma too agrees that the cannabis legislation in Portugal is highly advanced, but there’s still a lot to do to let it express its full potential. “The biggest challenges in our country’s market mainly concern regulations,” Jose Real from Cannprisma says. “Especially when it comes to different policies from one country to another.”
Since everything needs to be EU GMP certified in Portugal, Portuguese growers surely have an advantage over others that don’t have to comply with that from the get-go. Yet, running such a facility is far from being a piece of cake. “Running EU GMP facilities is a priority requirement to get started into this industry,” Jose points out. “Thing is, the COVID situation caused an immense delay in getting things done, both in terms of materials and human resources. As a consequence, you see a shortage of EU GMP flowers. So, instead of pushing the industry forward, the EU GMP combined with the pandemic limitations are slowing down the market and the industry as well.”
Another important aspect to address is patient access, both from a prescription and a cost standpoint. “The government could and should participate in supporting the cost for cannabis-based medicines, as they do with several other medicines. On top of that, there’s still a stigma on cannabis as well as a lack of clinical information for doctors, who usually prescribe medical cannabis only when every other ‘conventional treatment’ has failed.
It is indeed by breaking this stigma and by producing more information for doctors that the biggest opportunities can be created. “The biggest opportunities lie in breaking the stigma and start considering medical cannabis as a solution, and not a last resort,” remarks Jose. And Europe is well poised to capitalize on the market potential of medical cannabis. “We see legalization tendencies across Europe and other economic communities. So, we expect that over the next months, the industry is to move forward, with more markets opening and reshaping to adapt to the new demands.”
Increasing number of licenses on the European market
Also, Amir Abbas from greenhouse manufacturer and supplier J. Huete agrees that the stringent regulations in Europe are a positive thing for the industry. “There is an increasing number of licenses to grow medical cannabis on the European market,” says he. “Regulation is demanding, and that I good for everyone. Some companies have lost their license for not complying with the required legal parameters.” In other words, such regulations help filter out all those less serious operators from participating in a highly valuable industry where a lot is at stake. “The rise of medical cannabis also means that there are more possibilities and alternatives for exporting and importing between countries on different continents. In some parts of America, the sale of built and licensed projects has skyrocketed.”
Materials and input prices have equally skyrocketed too, which poses challenges to greenhouse builders like J. Huete. “The main challenges right now are focused on trying to be as competitive as possible despite the prices of raw materials and transport,” he continues. “We are also trying to improve all our processes, including assembly times and delivery times for materials and equipment so that customers move forward steadily and quickly”
Amir Abbas, J. Huete
All in all, the cannabis market is moving rapidly, and there are plenty of opportunities outside of the EU too. “We think that the market will develop a lot in South America and Africa because of the lower production costs,” he points out. Such a prediction is of course substantiated by the fact that many companies are already applying for new licenses, or even new companies entering the cannabis sector, according to Amir. “Some of these companies will replace others that have lost their license because they wanted to enter the market too quickly without securing their infrastructure. Fortunately, this is not happening to our partners and clients.”
A shift in growing tendencies
Malik Touzri from seed supplier Dutch Passion has noticed that there are increasingly more licensed growers. “Some of these have become huge producers with a constant demand for both autoflower and feminized seeds,” he explains. “Some of them also grow from regular seeds, especially when they are searching for mother plants.”
Malik indeed points out that they are seeing something of a shift in growing tendencies. “Growers are increasingly aware of the different available genetics options. Some of them, especially medical growers, are interested in going beyond the traditional THC/CBD genetics.” Many have pointed at how focusing on THC only would mean neglecting the cannabinoid diversity of cannabis. There are a lot of opportunities in this still rather unexplored market, but some are already stepping in. “We have supplied many of the leading licensed growers and they are consistently interested in being the first in their area to offer products rich in other cannabinoids such as THCV, CBDV, CBG, and others. This is an area that Dutch Passion has invested heavily in, bot for feminized seeds and autoflower seeds. We expect that trend to continue, and we also expect to see strains rich in other, novel cannabinoids soon.”
Mahmoud Hanachi, head of genetics and new territories, Dutch Passion
Showing to the broader public that cannabis is more than THC could also help break the stigma, which Malik too sees as one of the biggest tests for the industry as a whole. “The ever-lasting fight for the acceptance of cannabis is an ongoing challenge. It’s the injustice of that situation that fuels that passion and drive for our team. Continuous improvement and the search for new genetics is a full-time job. One thing that gives us great satisfaction also is continuing to contribute to those who grow their own at home. We want to make it easier to grow great quality cannabis.”
Tomorrow we will publish part 4, the last of our 4/20 stories.