An exporting super power is about to be born from a change coming overseas in 2019. And Canadian cannabis CEOs are ecstatic.
Countries around the world increasingly are following the path made by Canada when it comes to cannabis.
Prohibition is breached by limited medical use, followed by widespread medical use, followed by cannabis becoming a major industry. Canada followed that trajectory the fastest, and the United States is doing it piecemeal, like several countries in Europe. But the overall arc is so similar in country after country after country.
It’s being fueled by changing attitudes toward cannabis, the mass realization that prohibition has failed, and the desire for a new source of tax revenue and jobs. Watching those jobs and tax revenues go to other countries is something officials don’t want. It’s similar in states right here – for example, New York Governor Andrew Cuomo can’t be happy that residents are leaving the state to go spend money on cannabis in a fully legalized Massachusetts or soon will in New Jersey, which is set to vote on legalizing recreational cannabis today.
Because Canada is ahead of the curve, well-funded companies there have the luxury of looking at the next lucrative frontier: exporting.
In the last week, we saw Aurora Cannabis announce a deal that will see them supplying Mexico‘s newly legalized medical marijuana market.
But, where exporting is concerned, there is a much bigger development getting ready to happen. It’s going to change the industry and create opportunities worth billions – yet, shockingly, I’ve barely heard investors or industry pundits talking about it publicly.
Here’s the big secret…
Israel Will Fast Become a Top Cannabis Exporter
Israel, the foremost pioneering nation in the area of cannabis research, is about to give the legal go-ahead to begin exporting cannabis. The change could happen as early as 2019, according to our sources, which include Dr. Michael Dor, head of the General Medical Division at the Israeli Ministry of Health.
Legislation to legalize the export of cannabis – something CEOs have been telling me and my research team since early 2017 they were looking forward to – has reached an advanced stage. The reasons for the change in Israel are the same as those I already mentioned about the rest of the world.
Now, the story of marijuana in Israel really is the story of worldwide cannabis in a nutshell.
Israel has among the world’s best-quality cannabis because it has been used primarily for research. Researchers demand extremely high-quality cannabis with precise ratios of THC, CBD, and other cannabinoids depending on the researchers’ needs.
The cannabis research tradition in the country is as strong as any and comes with the kind of government backing painfully missing in the United States. Indeed, it was Israeli researcher Dr. Raphael Mechoulam, who first discovered THC, the psychoactive component of cannabis. While working with various others, Mechoulam also discovered anandamide, one of the cannabinoids humans produce naturally, and it was his work which led to the discovery of the endocannabinoid system.
His nickname is “the father of cannabis research,” after all.
Dr. Dor, a founding advisory board member at the National Institute for Cannabis Investors, has worked alongside Mechoulam and is a prominent cannabis researcher in his own right.
This week, Dor told me he was confident, not to mention excited, that new exporting allowances would go through soon.
But that’s not all he shared…
Cannabis Exporting Is the New Coffee
Israel will lead the world in the very high-quality, research-ready cannabis market – the country estimates it could generate $2.6 billion per year in a global market, which will quickly exceed $50 billion and then $100 billion. And if the country listens to Dr. Dor, that estimate will turn out to be far too low.
Dor also said that the cannabis market estimates are too small, for Israel exporting and for the global industry. He highlights not just medical applications, but food supplements, cosmetics, and pet medications. Also on his radar – and, of course, ours at the Institute – are industrial hemp applications like furniture, clothing, and even more environmentally friendly plastics.
And people like Dr. Dor are going to be leading Israel into the export market as a center for cultivation and, in the process, creating a template for other markets to come. After all, Canada and most of the United States are not ideal growing locations for reasons including the weather and much higher labor costs. Over time, it is inevitable that much but not all growing will happen outside of North America.
Israel’s change highlights this and the fact that cannabis is becoming a truly global market. It will exist much like coffee does today.
You may have wondered what my big predictions for 2019 are – after all, it is that time of year. Well, Israel officially becoming an exporter is among them.
Of course, there is no shortage of things to watch for in the coming year where legalization is concerned, in the United States and around the world:
- The cannabis market is going to be so large that the estimate of $100 billion may be far too low. Especially for medical use, cannabis usage will become legal in countries representing most of the world’s population with the possible exception of China. And industrial hemp and CBD will be even more widespread – China is already a hemp producer.
- The cannabis market, including hemp, will disrupt more industries than most people realize. Everyone knows that cannabis will disrupt the alcohol and pharmaceutical markets. Few realize it will challenge the $1 trillion plastic market.
- More and more states and even very conservative countries around the world will draw the same conclusions that Israel and the U.S. are reaching – that the war on drugs has failed and replacing it with a safe, regulated product that generates tax revenue is the better course.
- Countries and states that do legalize cannabis in 2019 will find sales in the newly legal markets will be larger than projections.
Thanks for being an important part of the National Institute for Cannabis Investors,
Executive Director, National Institute for Cannabis Investors
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