The CTA visited ICBC Berlin and gained further insights and meet players in the international cannabis markets.
Europe’s cannabis market is heating up, and at the centre of the storm is Germany. With patient numbers skyrocketing and imports more than doubling, all signs point to a seismic shift. But while a flower price war brews across the German market, what does this mean for neighbouring countries like the UK?
At the recent International Cannabis Business Conference (ICBC), Artemis Growth Partners’ William Mueke painted a clear picture: Germany’s patient population has exploded from an estimated 200,000–250,000 before April 2024 to over 700,000–900,000 today. Imports have followed suit, jumping from 32 tonnes in 2023 to over 70 tonnes in 2024, with projections suggesting over 100 tonnes for 2025.
This rapid demand shift, catalysed by the Cannabis Act (KCanG), has transformed Germany into the largest legal medical cannabis market in Europe, and with it, a brewing flower price war.
The Drivers of Germany’s Price Squeeze
Several factors are contributing to price compression in Germany:
- Oversupply Risks: The increase in import volumes has outpaced demand in some quarters, particularly for mid-tier flower (20–25% THC), where much of the inventory sits.
- Short Shelf Life: Cannabis flower as a pharmaceutical API has a limited life. Bulk product tied up in warehouses risks devaluation or spoilage.
- Low-Cost Global Producers: Companies like Pharmarolly (North Macedonia) and Clever Leaves (Colombia) have a clear price advantage, supplying high-quality flower at lower cost.
Winners and Losers
This market dynamic benefits some and squeezes others:
- Winners: Tech-forward platforms like Bloomwell Group, efficient GMP producers like Four 20 Pharma, and innovators like Valcon Medical, who are leading in new formats like legal vapes.
- Losers: Undifferentiated importers and wholesalers stuck with aging, high-cost stock are in a tough spot as prices fall.
What About the UK?
To gauge the ripple effect, we turned to E. Stanton McLean, Managing Member of Artemis Growth Partners for insights:
“I think the German market will be more of a price war to the UK given how much product is flowing into there. Until we see patient growth, I don’t think we will see price wars in the UK.”
In other words, patient numbers are the trigger, and the UK simply isn’t there yet. Without significant increases in legal medical cannabis scripts, the UK market won’t feel the same supply-demand squeeze. But that doesn’t mean the UK is insulated forever.
As Germany’s reforms deepen, surplus product may seek markets elsewhere, potentially undercutting prices or spurring a shift in how UK suppliers think about their supply chains.
Strategic Takeaways for UK Operators
- Anticipate Margin Pressure: While not immediate, a softening in flower pricing is likely as continental spillover increases.
- Differentiate or Die: Generic, high-cost inventory will be punished. Efficiency, innovation, and patient-centricity will define resilience.
- Policy Watch: Any uptick in UK prescriptions could catalyse a similar supply surge. Operators should be preparing now.
A Tale of Two Markets
Germany is experiencing a cannabis renaissance, with economic growth, patient access, and policy alignment converging. The UK, by contrast, remains cautious - watching and waiting. But one thing is clear: the price war has begun. Whether you’re a grower, importer, or investor, ignoring Germany’s momentum could mean missing the future of European cannabis.
