Medical and cosmetical cannabis
Colombia is well positioned to become a large producer and exporter of value-added cannabis products. Colombia’s climate, floriculture knowledge, human capital, and extensive experience in the pharmaceuticals and cosmetics sectors give the country a competitive advantage over other markets. In addition, the government’s strong support to consolidate a regulatory framework results in a highly competitive and reliable market.
Why invest in this sector?
The medical cannabis and cannabis cosmetics industry has huge potential for growth in Colombia.
- According to Fedesarrollo, Colombia has 45 hectares available for cultivating medical cannabis, with potential to produce extracts and resins with an estimated export worth of USD 109 million in 2020, surpassing exports from other sectors, including several food preparations (yeasts, sauces, among others), processed fruits and vegetables, and personal care products.
- According to Fedesarrollo, Colombia could have 449 cultivated hectares by 2025. In a given scenario where a liter of extract was worth USD 4,000 in 2020, with a 75% downturn between 2020 and 2030 due to inventory buildup around the world, Colombia has the potential to export USD 865 million in 2025 and USD 1.532 billion in 2030. https://www.fedesarrollo.org.co/
Colombia has remarkable conditions for cultivating cannabis plants.
- Colombia's environmental and geographical conditions are ideal to produce 4 harvests per year in three different cultivation methods (open field, open field with semi-automatic irrigation, and greenhouse with light and irrigation).
- Due to its geographical location, Colombia has 12 hours of sunlight all year round, thus maximizing crop yields and reducing production costs.
- Extensive knowledge and human capital dedicated to the floriculture sector, as well as a suitable infrastructure give Colombia the right leverage to develop the sector through knowledge, labor, logistics capabilities, and research capacity.
- The Colombian flower industry is one of the country's most important and representative economic sectors and it is the second largest within agricultural exports, accounting for 29% of the exports. Also, Colombian flowers currently reach about 80 international markets, spanning 5 continents.
- Colombia is the world's second-largest flower exporter, the leading exporter of carnations, and the top supplier to the United States.
Colombia has well-established industries that can develop value-added cannabis products.
- Colombia has a mature pharmaceutical market to support the cannabis industry's growth. By 2030, Colombia's pharmaceutical market is estimated to be worth USD 9.3 million with a projected CAGR of 7.1%. The medical cannabis sector is expected to capture a 3.29% share of the national pharmaceutical market. (Roadmap for the cannabis sector, Colombia Productiva, 2019) https://www.colombiaproductiva.com/
- In 2019, the cosmetics and personal care products sector reported USD 3.058 billion in sales and exports worth USD 476 million. Colombia is an export platform for cosmetics, exporting over 15% of total output.
Colombia has a growing middle class and logistics capabilities to potentially expand its consumer market.
- In February 2020, Colombia’s population reached 50 million people and became the third most populous country in Latin America, after Mexico and Brazil.
- Colombia's cannabis production is estimated to be large enough to treat pain and symptoms of 4.5 million patients nationwide and 60 million in Latin America who suffer from conditions such as cancer, multiple sclerosis, and epilepsy. In Colombia alone, more than 2.2 million people are estimated to suffer from chronic pain; approximately 475,000 suffer from post-traumatic stress disorder (PTSD), and other 520,000 have insomnia. (Survey on characterization of the medical cannabis industry productivity in Colombia. Fedesarrollo, 2020). https://www.fedesarrollo.org.co/
Colombia is moving to consolidate the regulatory framework for the cannabis sector.
- In Latin America, Colombia has become the point of reference in the region as one of the first countries to structure a regulatory framework to have a cautious and informed access to medical and scientific uses of cannabis and cannabis-derived products.
- Besides having been allocated one of the 5 largest cannabis production quotas worldwide by the International Narcotics Control Board (INCB), the current legal framework of Colombia’s industry is in compliance with the parameters established by the United Nations. https://www.incb.org/incb/es/index.html
- Several important industry milestones have been achieved in 2020, such as the first export of seeds to several markets, including the United Kingdom, the United States, and Germany; approval to produce the first medical cannabis product; and the launch of the Information Mechanism for Cannabis Control (MICC, as per its Spanish acronym), which consolidates all licensing procedures, from filing to issuance, and subsequently controls and monitors licensee obligations and transactions (Asocolcanna, June, 2020). http://asocolcanna.org/
Investment opportunities in the medical cannabis and cannabis cosmetics industry:
- Capital injection by investment funds
- Set up R&D labs for new product development
- Add new medical cannabis cultivated hectares to extract raw materials
- Establish production plants to manufacture value-added products
- Create specialized agrochemical production plants for medical cannabis crops
- Invest in technology related to cannabis crops (automated systems such as climate control, air conditioning, etc.)
 3.595,9 COP = 1 USD. OANDA, Currency Converter.