Cannabis Competitors in South Africa
Legal cannabis today is a lucrative modern market in the U.S. and Canada. Sales in 2018 were $10.8 billion and are expected to grow to $47.3 billion by 2027. Four companies were provided with licenses to export medical cannabis, or dagga, from South Africa in April 2019 and a similar trend is visible worldwide.
Applying for a license to grow medicinal marijuana requires that you have a facility available. The facility requires various technical and commercial aspects to be in place to be eligible for the cultivation of cannabis. Estimates for the setup cost of a facility range between R3 million and R5 million. Additionally, another R2 million or more is required for essential growing components, such as irrigation.
Edibles and other infused products show massive potential for new and innovative products. Cannabidiol (CBD) was removed from South Africa’s list of highly-controlled drugs in May 2019 and is now officially available on prescription. Numerous illegal products with CBD are being sold already. CBD is being added into anything and everything, from CBD infused coffee to gummy sweets and lubricants. Do you know where to position your CBD product or at what price point?
Analysts predict that the legal marijuana market in the U.S. will outperform beer and wine sales by 2027. The growth in sales is mostly thanks to recreational marijuana use. Products such as edibles, infusions and concentrates, which include tinctures and salves are becoming extremely popular. In addition, users of edibles, infusions and concentrates are increasingly over 50 years of age, more risk averse and avoids smoking altogether.
Will your potential product cater to the fastest growing demographic of cannabis consumers? Contact us if you are considering entering the cannabis market in South Africa to avoid costly mistakes in this booming industry.
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