Cannabis Solidifies its Global Stature
Friday, April 12, 2019 8:18:00 PM
Cannabis has grown into a global force recently, driven specifically by the spur of ongoing legalization efforts. Despite cannabis still being illegal in most countries, the movement for legalization is stronger than it's ever been.
In October 2018, Canada became the second country to ever legalize cannabis entirely, joining Uruguay on that short list. Shortly after, the U.S. held its mid-term elections in November where Missouri, Michigan, and Utah all legalized cannabis on a certain level. Meanwhile, globally, a string of countries such as Australia, Germany, and South Korea began accelerating their medical cannabis programs. Furthermore, Argentina, Columbia, the Netherlands, Spain, and many others have decriminalized cannabis, allowing for personal moderate consumption.
Moreover, hemp-derived CBD products like tinctures, creams, and oils are seeing massive exposure because they are legal within the U.S. The proliferation of cannabis legalization is leading to an explosive emerging global marketplace, where many investors and entrepreneurs have noticed. Cannabis-based companies have expanded significantly over the past few years due to these political trends as well. And many of the top players within the industry have already implemented international operations, as the medical cannabis industry currently accounts for the majority of the market share globally.
However, the North American region is expected to shift the market share from medical to recreational, primarily due to U.S. states like Colorado, California, Washington, and Nevada and the maturing Canadian recreational market. According to data compiled by Mordor Intelligence, the global cannabis market was valued at USD 7.7 Billion in 2016 and is expected to reach USD 65 Billion by 2023. Additionally, the market is expected to grow at a robust CAGR of 37% throughout the forecast period from 2019 to 2024.
Convention on Narcotic Drugs, cannabis remains a Schedule 1 drug internationally, which is the strictest regulation. However, the World Health Organization (WHO) proposed a recommendation to reschedule cannabis due to its medical benefits. Furthermore, the U.S. Drug Enforcement Agency took notice and delisted CBD as a Schedule 1 and reclassified it as a Schedule 5. The United Nations Commission met throughout March 2019 to discuss matters of cannabis legalization.
The U.S. in particular was interested in discussing the legality matter revolving around cannabis. Additionally, the U.S. Food and Drug Administration is holding its first public hearing on CBD in May, as the agency looks to legalize cannabis in food and drinks. Outgoing FDA Commissioner Scott Gottlieb is collecting data to prove the credibility of cannabis and its therapeutic effects.
Previously, cannabis was heavily restricted internationally and resulted in harsh consequences if users were caught. Now, the industry has transitioned after many countries began to explore opportunities within the market.
"The industry is at about 5 percent of what it will be someday," concurs Tyler Stratford, Director of Client Operations for cannabis consulting firm Canna Advisors. "Even if the path forward isn't straight, we're certainly on a path forward. The tide has changed, and there's no turning it back now."
WeedMD Inc., a federally-licensed producer and distributor of medical-grade cannabis, just announced breaking cannabis news that, "it has closed on the purchase of an additional 60 acres of prime land located directly adjacent to its 98-acre Strathroy property. WeedMD's outdoor grow now has the potential to increase to more than 100 acres.
As previously announced, the Company has applied to Health Canada for an amendment to its Strathroy licence to expand beyond its greenhouse cultivation with an initial 25-acre, low-cost, outdoor grow operation in 2019. Link to release here. An additional 25 acres had previously been planned to come online as Phase II in 2020. With today's announcement, Phase II will increase to 75 acres for an overall outdoor cultivation of 100 acres online by 2020.
Pending Health Canada approval, WeedMD's outdoor grow is expected to increase its total yield to more than 100,000 kgs of cannabis in 2020 and more than 150,000 kgs when combined with its greenhouse cultivation.
Outdoor grow video
"With the amalgamation of this property and our existing licensed footprint, we now own more than 160 acres of contiguous land in Strathroy – that's 100 adjoining acres of prime workable agricultural land for outdoor cultivation. WeedMD is well-positioned to be the industry leader setting the benchmark for low-cost, scalable, quality-driven outdoor production in Canada," said Keith Merker, CEO of WeedMD. "As one of the first out of the gate, our experienced cultivation team has started onsite preparedness with ready-tested genetics and clones being propagated at our state-of-the-art greenhouse. The ability to produce consistent strains for dried flower, extracts and concentrates at a fraction of the cost of other production platforms will give us a strategic edge as we expand our product lines and commercial reach with our first outdoor harvest expected in fall 2019."
"Our Strathroy property was strategically selected in 2017 for its modern greenhouse and future growth potential. The vast outdoor property has full sunlight, an abundance of air flow, a protective buffer zone of trees and proximity to our infrastructure and propagation operations at the greenhouse. We have now capitalized on the opportunity to expand across perfectly-maintained adjacent lands already primed for outdoor cultivation - all of which can now be easily folded into our licensed property," said Derek Pedro, Chief Cannabis Officer of WeedMD. "With the purchase of the adjacent 60 acres of land for outdoor grow, we're well on our way to rapidly scaling production, with Phase II bringing us to full capacity in 2020."
About WeedMD Inc.
WeedMD Inc. is the publicly-traded parent company of WeedMD Rx Inc., a federally-licensed producer and distributor of cannabis products for both the medical and adult-use markets. The Company owns and operates two facilities: a 26,000 sq. ft. indoor facility in Aylmer, Ontario and a state-of-the-art greenhouse and outdoor facility located in Strathroy, Ontario.
The Company currently has 136,000 square feet of licensed production space and is expected to have a total footprint of more than 550,000 square feet of indoor and greenhouse production in addition to more than 25 acres of outdoor cultivation space online in the first half of 2019. WeedMD has a multi-channeled distribution strategy that includes selling directly to medical patients, strategic relationships across the seniors' market and supply agreements with Shoppers Drug Mart as well as six provincial distribution agencies".
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