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Research consultancy Prohibition Partners has predicted that medical cannabis will account for approximately two-thirds of the total value of Latin America’s cannabis market by 2028 in its first Latin America cannabis report.
It estimates that the region’s cannabis market is worth $125m this year and will be worth $12.7bn in 2028; the medical cannabis market is forecast to be worth $8.5bn in a decade.
This is due to the ability of Latin American countries to provide cannabis products for export at a lower cost than in North America and Europe, primarily because of cheaper labour and facilities, as well as a better climate.
In addition, ten of the 11 countries focused on in Prohibition Partners’ report have legalised medical cannabis in the last two years; the exception is Panama. This causes the establishment of a domestic or regional market for this form of medicine through its integration into healthcare systems.
The researchers expect that legislative changes will occur in the next few years, which will help to further expand the regional medical cannabis market.
Prohibition Partners managing director Stephen Murphy said: “The Latin American cannabis market plays a pivotal role in the growth of the international cannabis industry. A rapidly growing economy combined with a very competitive workforce and wealth of natural resources positions the region as a potential leader for cultivation and processing.
“Despite the regions dark history with cultivation of narcotics, we anticipate Latin American governments will quickly recognise the long term economic impact of a thriving domestic medical cannabis industry and seek to support the development of a legal and regulated medical cannabis industry.”
In the Latin America cannabis report, Chile and Mexico are seen as the main drivers of growth in the medical sector over the next ten years.
Chile legalised medical cannabis in 2015, following a pilot project involving clinical trials in 2014. In 2018, the market value of medical cannabis is expected to be $186m in 2018. This is forecast to grow to $3.35bn in 2028 out of a $5bn total for the entire cannabis industry in Chile.
Its public health institute is primarily overseeing the development of medicinal cannabis products in the country. They are focusing on the medicinal properties for cancer patients, drug resistant epilepsy patients and non-cancer chronic pain patients.
Mexico legalised cannabis for medical use in June 2017 with overwhelming public support. The Mexican authorities are currently refining the regulatory structure it will fit into. However, this is expected to be sped up by the incoming President Andrés Manuel López who has supported legalisation in the past and has appointed a major advocate as his interior minister responsible for implementation.
In 2018 the medical cannabis in Mexico is predicted to reach $5m, this will increase to $1.33bn in 2028; the total Brazilian cannabis market is expected to reach $1.99bn in a decade.