Dirk Heitepriem from the German Cannabis Business Association (BvCW) told DW that suppliers of cannabis seeds, garden supplies, fertilizers and grow lamps will benefit from Germany's decision to legalize cannabis.
Germany partially legalized cannabis in April, relaxing regulations to allow adults to grow up to three plants for personal use. People who can't or don't want to grow plants but want to legally source the drug can join cannabis social clubs from July 1. These nonprofit cooperatives can grow and distribute cannabis to their members under strict conditions.
German horticulture supplier Compo is one company that is already seeing a turnaround after launching an entirely new product line for cannabis growers. The Münster-based company, which has around 1,000 employees across Europe, has seen sales of its products, including specialized cannabis potting soil and fertilizers, far exceed expectations.
A Compo manager said, “We expect sales to increase further next year.''
German company Compo was an early entrant into the cannabis market Image: Benjamin Restle/DW
Seed sales soar
However, due to the legal uncertainty surrounding the sale of cannabis seeds in Germany, many individuals are turning to foreign seed banks such as Royal Queen Seeds, a major market player based in Barcelona. When Germany's partial legalization went into effect, “we had 10,231 orders in one day,” said Shai Ramsahai, president of Royal Queen Seas.
He said high demand initially flooded the company with thousands of orders, but it has now stabilized at about 3,000 to 4,000 orders per day. Ramsahay said that in April, Royal Queen Seas' online business “grew by 300%, with total online revenue of €6 million.”
Zannesia, another major cannabis seed bank operating in the Netherlands, is also seeing a surge in orders from Germany, the company's general manager Nick Ave told DW. “Every year, from around mid-March to early June, we see an increase in seed sales as people look to start growing plants. Typically, we see an increase of about 30% during seed season; This year it was a 150% increase.” ”
This year's Mary Jane Cannabis Fair in Berlin saw a large number of exhibitors displaying grow tents and other equipment. Image: Benjamin Restle/DW
Medical cannabis could see even stronger growth
While companies profit from individuals growing cannabis for personal recreational use, Germany's medical cannabis industry could see even stronger growth. According to market analyst Prohibition Partners, the drug has a lot of potential, with “an estimated patient population of more than 200,000 patients,” and “sales, patient numbers and imports expected to increase year-on-year.” It is said that
With this year's partial legalization, marijuana is no longer classified as a drug, making it easier for patients to receive prescriptions. Domestic commercial medicinal cannabis production was also tightly regulated, with production quotas capped. This has now changed. Jacob Manthei, Jürgen Rehm and Uwe Veltein wrote in the influential medical journal The Lancet: “New licenses have been issued for domestic production and distribution, thereby liberalizing the market. “It will increase competition and probably strengthen the industry.”
BvCW's Hitepriem said he expects that “improved access to medical cannabis for patients will increase demand for medical cannabis and benefit medical producers.”
DEMECAN is only one of three companies currently permitted to grow medical cannabis in Germany Image: Benjamin Restle/DW
DEMECAN, a pharmaceutical company based near Dresden in eastern Saxony, is currently the only German company licensed to grow medical cannabis in the country. Spokesman Franz Grossmann said the company plans to increase its cannabis production from 600 kilograms (1,320 pounds) to 2 tons a year as production quotas are lifted.
He added that DEMECAN welcomes liberalization, which will allow the company to realize its full economic potential and will benefit Saxony and Germany as a whole.
Bad Bonanza?
Germany's legalization has caused considerable excitement, particularly regarding the medical market, but Heitepriem warns against excessive optimism.
Public interest in cannabis is increasing, with large numbers of visitors and hundreds of exhibitors attending this year's Mary Jane Cannabis Fair in Berlin. Image: Benjamin Restle/DW
“The medical sector has seen rapid startup development in recent years, with increasing interest from US, Canadian and European companies to invest in Germany,” said Heitepriem. But he added that many companies learned a lesson from watching the cannabis bubble burst after Canada legalized cannabis in 2018.
Hitepriem said the revenue projections have been “overexaggerated in all the discussions we've had on this subject so far,” but he still believes there is “great potential for revenue to reach billions of dollars, but there is uncertainty.” “There are so many variables that it is impossible to give an actual estimate.” . ”
Editor: Ben Knight
