Canada’s dried flowers exports have experienced impressive growth. The sector has reached record levels since October, and the 3Q24 figures show a year-over-year increase of more than double. According to Pablo ZuanicSenior Analyst at Zuanic & AssociatesThe strong growth of dried flower exports is a sign that the international market is booming, and Germany has emerged as one of its key drivers.
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The third quarter of 2018 saw a record-breaking October and strong growth
Canadian dried flower sales reached a new high in October 2024 of $20.18million, placing Canada on track to reach $187.5million by the end 2024. In comparison, they were $120million in 2023 and $96.5million in 2022.
In 3Q24 exports reached C$69million. This is a 106% increase year over year, and a 19% rise quarter over quarter. Zuanic predicts Q4 2020 will continue to grow, possibly reaching C$85 millions, an 87% increase year-over-year.
Germany and Australia lead export growth
Germany is rapidly overtaking Australia in the importation of Canadian dried flower.
Germany was responsible for 26% (up from 28%) of all Canadian dried flowers exported in 3Q24. This is a substantial increase compared to the 28% exports last year. Sales to Germany (including reshipments from Portugal) accounted for approximately half of export growth in the third quarter. Zuanic states that “Germany’s inventory shortages and high demand reflect the ongoing market growth.”
The average price of dried flowers exported in the 3Q24 was $1.58 per 100 grams. It is down from $1.67 in Q2, but higher than $1.46 in Q3 2023. Export prices for Germany increased significantly to $2.55/gram from $2.39/gram in Q2, underlining the attractiveness of the German marketplace.
Zuanic’s report also highlights the key export players. “Aurora’s ACB Curaleaf exports are all from Canada. CURLF “We ship from Canada to Portugal in order to process EU GMPs,” he said.
Read Also: Europe Is Turning Cash Flow Positive, ‘We’ll See What Happens In The U.S.,’ Says Curaleaf’s Boris Jordan
The market for extracts shows less consistent growth
Canada has seen a more uneven growth for cannabis extracts such as oils, vapes and CBD. While the dried flower industry is booming, it’s not so with Canada’s cannabis oil or extracts. Extracts exports were $32,02 million during the first nine month of 2024. That’s down from $41.7 millions in the same period for 2023.
Flower exports have now vastly exceeded extracts.
The value of flower exports in 2023 was more than two times that of extracts. But by the third quarter of 24 the exports of dried flowers were almost six times as large. Zuanic states, “As markets for medical cannabis deregulate in Germany, it is likely that dried flower exports will continue to be the main driver of growth.”
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Commodity Lane
What lessons can other markets learn from Zuanic’s research? While Canada is the leader in cannabis exports it still relies heavily on the commodityization of raw flower, which could lead to a deterioration in exchange rates over time. This will be especially true as European countries start extracting oil from cannabis locally instead of purchasing Canadian cannabis oils.
To avoid falling into this trap, emerging cannabis economies such as Colombia, Argentina and South Africa should invest in industries that add value, like oils, extracts and vapes. This will ensure they don’t become relegated only to providing raw materials.
Focusing on local product and processing innovation can help them capture more of the cannabis value chain globally and ensure a sustainable and profitable future.
Read Next: German Cannabis: 20 Tons, 10M Grams – And That’s Only 0.3% Of The Market, What’s Missing?
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