Canadian pot producer Tilray Inc. (NASDAQ: TLRY) continues to invest in its overseas operations, as the company said on Wednesday it struck a deal to add 20 hectares of outdoor cultivation space in Portugal to further supply Europe’s medical cannabis market.
The Nanaimo, B.C.-based company said its subsidiary, Tilray Portugal, inked a deal to lease the roughly 50 acres from Esporão, a large agricultural business and landholder in the country. The outdoor cannabis cultivation site is located in Alentejo, Portugal and Tilray said it successfully planted in July and a harvest is expected in fall 2019.
The fresh pot supply will be dried at the new site and then shipped to Tilray Portugal’s existing EU campus in Cantanhede, Portugal. There, the company has five hectares of indoor and outdoor cultivation facility, along with 6,500 square meters of manufacturing, processing and research space.
“We’re proud to be expanding our capacity to produce high-quality medical cannabis products in Europe using innovative outdoor growing methods.” Sascha Mielcarek, Tilray’s European Managing Director, said in a release. “We look forward to supplying patients in need in existing and new markets with Tilray’s medical cannabis products, proudly produced in Europe.”
This outdoor cultivation site in Portugal will increase our capacity to supply medical cannabis across Europe and to other international markets. https://t.co/VXkNnkCE3d
— Tilray (@tilray) August 7, 2019
Tilray banking on Europe
With supply shortages wreaking havoc on Canada’s pot industry in the early days of legalization, Tilray CEO Brendan Kennedy was openly critical of other cannabis companies for adding to the supply issues in the country.
While the pot sector waits for the Canadian industry to adjust and mature, large cannabis producers like Tilray have looked to international markets in the search for profits.
To date, Tilray said it invested approximately €20 million ($30 million) in its existing EU facility in Portugal. The site currently employs more than 150 people, with production ramping up and multiple harvests anticipated in the coming months. Tilray hosted an official ribbon-cutting ceremony celebrating the grand opening of its EU Campus in April.
In May, Tilray Portugal received its manufacturing license and initial GMP-certification, allowing the company to manufacture and export GMP-certified dried medical cannabis across Europe.
The company not only services the European markets through Tilray Portugal, but it also recently made a bulk shipment of medical cannabis oral products to U.K. pharmacies in June.
Tilray has six cannabis products approved for medical use in the U.K., which legalized the drug medically late last year after the country drew international headlines after a 12-year-old epileptic boy had his cannabis medication confiscated.
According to research from New Frontier Data, the U.K. is the fourth most valuable medical cannabis market in Europe at US$4.6 billion. The research firm estimates the total value of legal medical cannabis demand in France is US$10.5 billion, in Italy it’s US$9.7 billion, and in Germany it reaches US$9.5 billion.