LATAM: An update on cannabis in the region (August 2021)
Today’s article will be an update on the cannabis market in Latin America, and during the last couple of months there have been a few developments. One interesting point to note before getting into any details is that with an industry such as this, legislation and attitude are difficult entities to change. This is to say that the lag-time between a government meeting or a protest by members of activist groups campaigning for changes to be made to the legal status of cannabis and subsequent tangible change is not instant. This means a great deal of patience is needed when keeping an eye on updates, however, it is not all moving at a snail’s pace, and as more countries are immersing themselves in the possibilities of relaxed legislation and the benefits that come with this, the market expansion leads to new opportunities, and more importantly, new updates for us to share with you!
The first piece of news we have to share with you comes from Paraguay, where the Latin American country has become the world leader in industrial cannabis. If you follow our blog, or legal cannabis as a sector in general, it is apparent how much potential lies within this market, making this update all the more significant. With export links to the United States, Canada and also Australia, the latter of the two being relatively new, the country has propelled itself onto the world stage, following other pioneering nations from the region in the form of Uruguay and Mexico.
It may seem sudden, this is to say, Paraguay’s rise to the top has not been something expected, however, this is down to a company called Healthy Grains, who signed a deal with the US to process cannabis fibres in Paraguay and therefore bringing a lot of attention to the nation and making it a leader of the industry. Considering the cultivation of this kind of cannabis has only been legal for less than two years, the growth is certainly something to keep an eye on in Paraguay.
At the tail-end of July, Colombia authorised the exportation of dried cannabis plants that are to be used to medicinal research purposes. We have talked rather a lot about medicinal cannabis and the market within Latin America, therefore, this news is only positive, providing room for expansion and also potential for more positive mindsets and attitudes to be adopted towards the drug in other parts of the region. Adding this legislation builds upon the already exportable products of cannabis derivatives, expanding the market potential on a more global scale for Colombia where medicinal cannabis growth has been legal for five years. Duque, the president, has been quotes as saying the cannabis flowers could make up more than 53% of the global market, providing further evidence to suggest this move is with the future in mind, and is certainly an attractive prospect for potential investors.
The final update we have for today comes from Mexico, one of the countries with the most potential in this industry across the entire globe, further exemplified and reinforced in June when the bill for the legalisation of marijuana for recreational use was passed. One important thing to mention with this is that it is not an all-encompassing law, as commercialisation is not allowed yet, simply the use of the drug for personal consumption. However, despite this, it is still a massive step forward and a significant landmark as other than Uruguay, recreational use of the drug is not common in Latin America and shows that changing perceptions of cannabis are leading to tangible changes in global and regional legislations and providing hope for investors involved in the market.
If you would like to stay up to date with the cannabis market in Latin America, do not hesitate to get in touch with us today. At Creimerman, we assist our clients with their cross-border ventures, striving to help make them a success, and we would love for you to be the next.