Why Europe Is The Biggest Cannabis Market In The World?
Europe is home to more citizens than the US and Canada combined. If most of the continent’s 50 countries legalizes medical cannabis in one way or another, it’s poised to be the biggest legal cannabis market in the world, according to a new report.
London-based Prohibition Partners released the second European Cannabis Report. The findings state that 12% of Europe’s 739 million people are either “irregular and intensive” consumers of cannabis. The entire cannabis market is forecasted to reach $66.8 billion, while there’s a potential MMJ market that needs to be tapped worth $42.8 billion. On the other hand, Europe’s recreational market is estimated to be worth $24 million, and the hemp market is estimated to reach $57.2 billion. As crazy as these figures sound, they don’t even include the ancillary and secondary markets!
Prohibition Partners’ report also indicates that in the past few years, several European nations have already passed MMJ laws but there is a 50% chance that some countries may pass recreational laws in the coming years. The report also takes a look at 11 countries with medical cannabis laws, particularly Germany, which accounts for a significant piece of the continent’s medical and recreational market. However, Croatia and Macedonia as well as other countries have been omitted from the report.
The report says that “an explosion of public and private companies have appeared on the European scene over the past 12 months. New and existing national and international companies are now operating in Germany, Poland, Portugal, and Czech Republic across all segments of industry.”
What To Know About The Legal Cannabis Market In Europe
Not all of Europe is progressive when it comes to cannabis use. The report also states that Norway and the United Kingdom are among the most conservative about medical use, while Norway, Sweden, France, Germany, and the United Kingdom are still conservative about recreational use.
Europe’s hemp market is also lucrative. France and Finland, in particular, have been using hemp since historical time for construction material, fiber, and textiles. In the last 25 years, the hemp industry has seen a significant boom, with production increasing 500% or 250% every 8 years. From 2013 to 2016, around 80,000 tons of hemp were produced in Europe alone. In 2016, 25,000 hectares of land throughout Europe were used to cultivate hemp.
Prohibition Partners’ report states that Europe is still in development stage in the cannabis industry life cycle, mostly because of the fragmented nature of the cannabis industry. However, when legal and regulatory frameworks are established, it’s expected that the industry will progress quickly and head straight for the growth phases.
Factors That Affect The European Legal Cannabis Market
Israel-Cannabis.com breaks down the factors that will affect the development of the legal cannabis market in Europe:
Banking: European cannabis legislation remains complex, but the continent has the potential to be pioneers and are hoping to create frameworks that comply with the European Banking Authority.
Investment: While the US is saturated with capital resulting in overpriced investments, Europe is still in its prime stages and views itself as a “green field of opportunity”.
Consumer perception: Negative stereotypes about cannabis still exist in Europe, but this can be solved by ensuring professionalism in all aspects of the supply chain.
Canadian legislation: The report’s authors suggest that Europe is a better match for Canada rather than the United States. They also hypothesize that Europe will create legislations based on success from the Canadian model.
Retail Market For Cannabis In Europe
A 2016 EU Drug Markets Report states that cannabis is the most widely used illegal drug in Europe, and is also the most accessible. Young people admit that they can easily get a hold of cannabis, sometimes within 24 hours. But not everyone buys their weed in Europe, many also grow it for their own use as well as sharing with friends.
The information on how the retail market operates in Europe is still limited but studies show that in different markets there are varying risks to both dealers and consumers. There is significant variation on how countries operate in terms of the retail cannabis market, which is probably due to the changes in legislation. In Netherlands, for example, it is legal for coffee shops to sell cannabis while in other countries, cannabis clubs are the norm. The maturity and cultural differences of the market also play a role.
The internet and other technological developments play a part in the market. The internet is a cause of concern since studies show that while internet purchase of cannabis isn’t reported, it’s widely purchased through the dark net. Mobile phones are also increasingly used to for drug deal meat ups in many countries throughout Europe, as its use helps to facilitate home deliveries and meeting places to exchange drugs which makes it difficult for law enforcement to trace.