Facing a crowded marketplace and stiff competition at home, Canadian cannabis producers are increasingly looking beyond national borders for growth. With exports surging, the global market is becoming a critical piece of their long-term strategy.
Exporting to Offset Domestic Struggles
The cannabis industry in Canada has undergone a dramatic transformation since legalization in 2018. While early years were marked by rapid expansion, overproduction and falling prices have since squeezed margins. Many companies are now turning to international sales to remain viable.
Exporting medical cannabis presents an opportunity for firms to diversify revenue streams and reduce reliance on a domestic market burdened by high excise taxes. The strategy appears to be working—Germany, a major market for Canadian cannabis, saw its imports from Canada double in 2024.
Germany Leads the Demand for Canadian Cannabis
Europe is proving to be a major growth area for Canadian cannabis firms. Germany, in particular, has emerged as a top destination. According to Germany’s Federal Institute for Drugs and Medical Devices (BfArM), cannabis imports from Canada reached 33,155 kilograms in 2024, up from 16,895 kilograms the previous year.
Germany is just one piece of the puzzle. Canadian companies are also expanding into Australia, Israel, and the UK, where medical cannabis programs are growing. These markets offer stable regulatory environments and high demand for pharmaceutical-grade cannabis.
The Barriers to Entry
While the potential for export growth is promising, success in international markets is far from guaranteed.
- Regulatory challenges: Every country has its own licensing and importation rules, requiring strict compliance.
- Manufacturing standards: To sell in Europe, Canadian producers must meet EU Good Manufacturing Practice (GMP) certification—a costly and complex process.
- Limited licenses: Despite having around 900 cannabis licenses in Canada, only 19 companies currently hold the EU-GMP certification required for European exports.
Village Farms Expands Its Global Footprint
One company making strides internationally is Village Farms International. With offices in Canada and the U.S., the company has secured export contracts in multiple regions. In 2023, its international cannabis exports totaled $8.4 million, and projections indicate that number could triple in 2025.
Sam Gibbons, the company’s senior vice president of corporate affairs, highlighted their growing international presence, particularly in the Asia-Pacific region and Europe. “The demand is there, and we have the capacity to meet it,” Gibbons said.
What’s Next for Canadian Cannabis Abroad?
With medical cannabis gaining traction globally, Canada’s role as a leading supplier is likely to grow. However, only a select group of companies have the resources and regulatory approval to capitalize on these markets.
As more countries legalize medical and recreational cannabis, Canadian producers will have to navigate evolving regulations and shifting consumer demands. Those who secure early access to international markets may be best positioned for long-term success.