The Cannabis Industry Opportunities in Europe Rise for North American Tech Suppliers
The European cannabis market is rapidly expanding, and there is a growing need for advanced technology suppliers to keep up with the expected demand. This offers a special opportunity for North American businesses in the cannabis industry to increase their market reach and generate profits in this developing market.
The opportunities for North American businesses in the European cannabis market will be discussed in this blog, including the rising need for advanced technology, the potential for partnerships and joint ventures with European companies, and the shifting regulatory and legal framework for cannabis in Europe.
The growing European Cannabis market
The European cannabis market is expanding quickly, and to keep up with expected demand, there is a need for advanced technology input.
In order to improve cultivation, processing, and packing, there has been a corresponding surge in the demand for highly developed equipment and technology. Because of the built-up experience in the domestic market, European companies and investors are looking at experienced suppliers and their vast industry network from North America.
Companies in North America have already made a name for themselves as industry leaders, creating advanced tools and solutions to assist organize processes and boost productivity. The year 2023 is the right time for these companies to position themselves in Europe.
North American businesses can create customized solutions for the distinct difficulties faced by European companies. This could include solutions that have been tailored to the soil, climate, and other environmental elements that are specific to Europe.
Traditional business models have been disrupted by the arrival of technology, opening up new options for both startups and existing businesses. For instance, technology has made it possible to build new platforms and marketplaces that link cannabis producers and customers, enabling direct-to-consumer sales and bypassing conventional distribution routes.
A lot of cannabis businesses are now creating pharmaceutical-grade goods for medical usage as a result of technology's disruption of the conventional pharmaceutical industry. With the potential to revolutionize the way that medical cannabis is recommended and supplied, this has opened up new chances for collaboration between the cannabis and pharmaceutical businesses. In Europe, the eGMP regulation has been driving this development.
Legalization and Regulation
The Netherlands, Germany, Switzerland, and Luxembourg were leading the way in modifying their countries' laws to allow for the use of cannabis for recreational purposes, according to First Wednesdays' "Recreational Europe" study. This research also emphasizes how popular the idea of legalizing cannabis under strict regulation in Europe is becoming. In April 2022, First Wednesdays conducted a study that revealed that 55% of Europeans were in favor of legalizing. Comparable levels of support were seen in Colorado and Washington in 2012. Regarding attitudes against marijuana, other nations to keep an eye on are Italy and Portugal.
The European Cannabis Association (ECA) has published a major issues paper on cannabis legalization in Germany that describes the situation of the market there today and offers suggestions for potential regulatory adjustments. The article points out that despite medicinal marijuana being legal in Germany since 2017, there are still obstacles in the way of access for patients, such as exorbitant costs and a lack of supply. The ECA advises that the government implement a system of social clubs, akin to those in Spain and Belgium, or permit patients to cultivate their own cannabis in order to address these difficulties.
The study discusses the prospective legalization of recreational cannabis in Germany in addition to medical cannabis. According to polls, over 60% of Germans support making cannabis legal for adult use, the ECA observes that there is strong public support for this move. The study suggests that the government create an adult-use cannabis market that is controlled, much like those in Uruguay, Canada, and a few US states. The ECA contends that this strategy would significantly lessen the negative effects related to the illegal cannabis industry while simultaneously generating tax revenue and creating jobs.
In 2023, Spain is steadily entering the leading position in the Cannabis Industry in Europe. A fresh set of cannabis legislation that will legalize adult-use cannabis in Spain is anticipated to be passed in 2023. Spain has long been recognized for its tolerant approach to cannabis use. The changes would also set rules for the production, distribution, and sale of cannabis products as well as govern the cannabis industry. The United We Can party, which is a member of Spain's government coalition, is the driving force behind the proposed legislation. If the amendments are approved, it may be a major development for the European cannabis market because Spain has the potential to grow to be one of the continent's biggest cannabis markets. However, there are concerns about the potential for regulatory delays and opposition from some members of the ruling coalition, which could slow down the reform process.
Partnerships and Joint Ventures
Partnerships and joint ventures with European businesses are further opportunities for cannabis businesses from North America in that region. These collaborations can aid North American businesses in navigating the difficult regulatory landscape and gaining ground in the European market. European businesses may offer helpful local insight and experience, as well as access to networks and channels for distribution.
EuroDev has been partnering with North American suppliers in the industry since 2018. Within these partnerships, EuroDev is tasked to perform business development activities in Europe. Partnerships have included companies that supply CO2 extract technology, eGMP-compliant drying solutions, and drying chambers as well as leading providers of vaporizer cartridges and power supplies for wholesale brands.
In conclusion, North American businesses in the cannabis machinery manufacturing industry have a lot of opportunities in the European cannabis market. North American companies can establish operations in Europe, share their knowledge with European cannabis enterprises, and develop custom solutions to deal with European-specific challenges. The possibilities for collaborations and joint ventures, the disruptive force of technology, and shifting attitudes toward the legalization and regulation of cannabis in Europe offer exciting perspectives to North American suppliers.
Interested to learn more about your company's potential to expand into the European market? Feel free to schedule a meeting with us and we will be more than happy to guide you through your European expansion.
Sources: Deutsche Welle, IMF
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