Cannabis: The first beneficiaries of legalization are emerging

As of: April 26, 2024 | Reading time: 3 minutes

Northern Lights, Ghost Train Haze or Hindu Kush – until now they could only be obtained more or less secretly on the black market. But with the partial legalization of cannabis, strains like these are now legally accessible.

It’s not just consumers who can expect a legal offer with a wide variety of cannabis variants. Numerous companies and start-ups also see a new market – even if it is likely to be much smaller than many in the industry had hoped. The term cannabis – the Latin word for hemp – is used for both marijuana and hashish. Marijuana is the dried flowers of the female hemp plant, hashish is the resin.

Smoking weed has been legal in Germany since April 1st. However, the new cannabis law imposes restrictions on use and trade. Adults aged 18 and over are allowed to consume marijuana, but not in front of young people or in front of, in or within sight of schools and sports facilities.

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Time restrictions also apply to smoking the drug in pedestrian zones. The herb can be obtained by growing up to three plants yourself or through so-called cannabis clubs that are currently being set up. Adults are allowed to possess up to 50 grams of dry cannabis flower. Up to 25 grams can be carried in public spaces.

The law does not yet provide for the free sale of cannabis in shops. Health Minister Karl Lauterbach (SPD) emphasizes that consumption should not be commercialized through legalization. Lauterbach makes it clear in a ministry video blog that he does not want to establish a cannabis and related marketing industry in Germany like in the USA.

In a further planned step of legalization – also referred to as pillar two by the ministry – the controlled sale of marijuana in special shops in certain model regions will also be tested. The Ministry of Health cannot currently say when these tests will start and how exactly they will be designed.

The managing director of the cannabis industry association, Jürgen Neumeyer, has observed increased growth in the industry since April 1st. “We are currently seeing a lot of dynamism in the cultivation of cannabis plants.” On the one hand, experts are in demand on questions of correct cultivation.

“But companies that rent out halls for cultivation or offer technical equipment such as lighting, irrigation, switching and safety technology are also already benefiting,” says Neumeyer. In addition, hardware stores are increasingly interested in including technical utensils for hemp cultivation in their offerings.

The new law also has consequences for medical use. “Prescribing cannabis as a medication will now be much easier and less bureaucratic for doctors,” says Neumeyer.

However, things will probably only become more economically interesting for companies with the second pillar of legalization. Selling in shops would allow you to appeal to a larger audience. The British market research company Prohibition Partners expects sales of recreational cannabis in Germany to be more than 300 million euros from 2026.

However, these figures depend on the pending political decisions regarding further regulated taxation. For comparison: For the recreational cannabis market in Switzerland – where cannabis is allowed to be sold in several cantons as part of model tests – the agency predicts a sales turnover of around 40 million euros for 2026, for the Netherlands – where cannabis is tolerated – it is around 40 million euros 162 million.