Canadian cannabinoid oil exports nearly six times higher in 2019

In economically underdeveloped countries (which Ukraine unfortunately belongs to) lobbyists of Canadian hemp companies persistently raise the issue of the need to amend existing legislation in order to be the first to enter newly emerging markets and to prevent domestic production from developing in the initial long-term receiving super-profits, and then creating subsidiaries that can indirectly control this highly profitable market for cannabinoid raw materials and products made from it. 

Canadian-made cannabinoid oil peaked in 2019 as companies seek to make the most of their market pioneers in opening up new markets across all continents. According to Canada’s Department of Health, CBD oil was allowed to export to at least 17 countries last year for medical and scientific use.

It should be noted that the main part of the export of cannabinoid oil is in only three countries, which suggests that Canadian companies are not always able to commercialize their market advantage and ensure the export of hemp in significant quantities. The main export destination for cannabinoid oil is Australia, where about 3,700 liters of CBD oil were shipped in 2019. Germany and Denmark, respectively, became the second and third countries in terms of supply with indicators of 790 and 336 liters, respectively. The three countries above accounted for 90% of all Canadian cannabinoid oil exported. 546 liters of CBD oil were shipped to the remaining 14 countries. In total, in 2019, Canadian companies exported 5,372 liters of cannabinoid oil, for use in medical and scientific purposes. This is almost six times more than 919 liters exported from Canada in 2018 and more than 12 times exported from the country in 2017 (435 liters). It should be noted that the Ministry of Health of Canada approved the volume of 12888 liters of cannabinoid oil for export in 2019. This fact indicates that the export potential of Canadian hemp companies is not less than the above 12.9 thousand liters of cannabinoid oil, and it was used in less than half.

Canadian cannabinoid oil exports

What causes the exponential growth of cannabinoid oil in the global market

The growth in the export of cannabinoid oil significantly outpaces the growth in the export of dried mass of cannabis leaves and inflorescences with significant therapeutic properties. The volume of exported cannabinoid oil of 5372 liters significantly exceeded the weight of dried hemp inflorescences exported from Canada in 2019 in the amount of 3,740 kg. Compared with cannabinoid oil, the growth dynamics of dried hemp leaves and inflorescences, which have significant therapeutic properties, increased by 160% compared to 2018. 

5372 liters of cannabinoid oil are equivalent to about 4996 kilograms of dried hemp inflorescences with significant therapeutic potential (according to the Canadian Ministry of Health, most licensed growers get 1 liter of cannabinoid oil if 0.93 kg of dried hemp flowers is used as raw material). Using elementary arithmetic, it is not difficult to calculate that in 2019, Canadian companies exported a total of about 8736 kg of cannabis dry weight, which has significant therapeutic potential.

The advantages of cannabinoid oil compared to the dry mass of leaves and inflorescences is:

- ease of use of cannabinoid oil in medical preparations, compared with the dry weight of the plant. That is why cannabinoid oil is most in demand outside of Canada; 

- a much larger market for cannabinoid oil compared to the dry weight of plants;

- higher market price for cannabinoid oil compared to the dry weight of plant inflorescences;

- simplicity and convenience of import-export operations with cannabinoid oil compared to the dry mass of plant inflorescences.

Commentary by the Ukrainian Technical Hemp Association

Australia, Colombia, Jamaica and Portugal, are preparing to enter the export market for hemp raw materials with significant therapeutic properties in the near future (dry weight of flowers, cannabinoid oil). Some countries that have regulated the possibilities of using the therapeutic properties of hemp for medical purposes so far seek to satisfy domestic demand through imports, however, all this happens exactly until the own production of the necessary raw materials is established. 

Considering the fact that in 2019 Canadian companies took advantage of no more than half of the declared export quotas, as well as the fact that already in 2020, at least Germany and Australia plan to “launch” domestic production of hemp raw materials with significant therapeutic potential on an industrial scale, it’s not difficult now to ascertain that Canadian producers clearly have a crisis of overproduction. Representatives of the Canadian hemp business are actively seeking to enter and gain a foothold in the new markets of countries that plan to regulate the possibilities for using the therapeutic properties of hemp for medical and scientific purposes. That is why in economically underdeveloped countries (which Ukraine unfortunately belongs to) lobbyists of Canadian hemp companies persistently raise the issue of the need to amend existing legislation in order to be the first to enter newly emerging markets and to prevent domestic production from developing for a rather long time at the initial stage, earning super-profits, and subsequently creating subsidiaries that can indirectly control this highly profitable market for cannabinoid raw materials and products made from it.