Why Canadian Companies are Investing In Colombian Cannabis

By now, you must know that Canada has legalized cannabis on a national level. This took place finally on October 17, 2018, but there are still some things to be ironed out. However, it has been reported that there are seven companies in Canada that have already received their cannabis licenses and have established cannabis research as well as manufacturing facilities located in Colombia.

In fact, these companies have invested more than $100 million in Colombia as it pertains to the cannabis industry.

The Companies

Canopy Growth Khiron Life Sciences Corporation and Pharma Cielo are some of the investors that have a desire to follow the investment model similar to mining and energy firms. This model involves raising money through the Toronto Stock Exchange, which in turn is invested into the Colombian economy and the economy of other developing countries.

However, the Canadian companies are looking at the potential that Colombia's cannabis industry has for the future as it relates to socioeconomics. Even though, the history of Colombia involves political corruption, violence and the cannabis black market, Colombian companies see past all of this. Their hope is to help to transform Colombia by investing in their cannabis industry.

Filling the Demand

Yes, everyone knows Colombia for its drug wars, but this does not mean that it cannot be revived as an economic rebirth through the investments that Canadian cannabis companies are willing to put into it. In fact, for the next few years, Canopy Growth has created a plan to put $60 million into the cannabis industry in Colombia. Some of the money will be spent on research, greenhouses and production facilities that will be located in Colombia. Canopy Growth is of the firm belief that with a population of 630 million, Colombia and other nations in Latin America has a demand for medical cannabis. They plan to fill that export and import gap.

Khiron Life Sciences Corporation began selling cannabis products in the Latin America region. Their plan is to produce more than eight tons of cannabis on an annual basis because of the demand that they see in the Latin America region, especially for medical cannabis.

The Motivating Factors

In Colombia, there is a yearly average of $550 spent for patients who use medical cannabis. For that reason, Canadian companies like Khiron see the huge potential in tincture products. Most Canadian companies do see the possibility of changing the landscape of the cannabis industry, but they also see potential for some of the best climate and soil to grow cannabis in Colombia.

In addition to introducing new cannabis products and utilizing the climate, Canadian companies love the area for the potential to get better pricing and quality products. These are the primary motivating factors why Canadian cannabis companies are leaning towards this country.

The Environmental Conditions

Colombia and Canada do have different environmental conditions and that can make a difference when it comes to transforming the cannabis industry as it relates to getting not just a higher yield, but one that is of the highest quality. The climate alone is enough reason to invest in the cannabis industry in Colombia.

With so many cold days in Canada, there is no way that cannabis can be grown outdoors and it cost a lot to maintain a hydroponic lab. Rain and sunshine is also essential to growing cannabis outdoors. Canada has seasons of snow and colder weather, which makes it more difficult to consider growing cannabis outdoors. So, Colombia is one of the ideal places to do so.

Final Summary

In addition to climate, pricing and demand, the cost of production is also a motivating factor to investing in the Colombian cannabis industry. Cannabis growers are getting ready to be part of this cannabis industry in Colombia as the investors in Canada come forward to negotiate.

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