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What You Need to Know (Updated 2024) – Cannabis Hemp Blog


Since the legalisation of medical cannabis in 2016, Australia has been steadily developing its marijuana industry — and it’s been attracting attention from international players and investors.

With a quickly growing population of over 27 million people and a robust agricultural industry, the country could be positioned to mould itself into a major force in the international cannabis space.

Here the Investing News Network takes a look at how the cannabis industry in Australia has been shaping up since legalisation. Read on to see what you need to know about investing in cannabis down under.

Australia cannabis market overview

As mentioned, Australia’s parliament passed legislation to allow the cultivation of cannabis for medicinal and research purposes in 2016 by amending the Narcotic Drugs Act 1967. Cannabis companies have been cropping up since then.

While the cannabis industry is still young, Australia’s agricultural sector is well established — in fact, it’s one of the largest contributors to the nation’s GDP. According to the Australian Bureau of Agricultural and Resource Economics and Sciences, the country’s agriculture output was valued at AU$80 billion in the 2023 to 2024 period, with forecasted growth of 6 percent for the 2024 to 2025 period. Australia’s agriculture export prowess means it may be able to capitalise on the trend of moving medical marijuana products internationally.

Recreational cannabis use isn’t legal in most parts of Australia. The exception is the Australian Capital Territory, which in early 2020 made it legal to grow, possess and personally use small amounts of cannabis. That said, the Australian Institute of Health and Welfare identifies cannabis as the most widely used illicit drug in the country.

A 2019 research study states that at the time more than 40 percent of Australians in were in favour of legalising marijuana entirely. More recently, a 2023 survey showed that 50 percent of Australians supported legalising the right to own six personal cannabis plants, with only 31 percent of those surveyed opposing such a law.

Medical cannabis is overseen by the Office of Drug Control, which issues three types of licences: research, manufacturing of a drug or product and cultivation or production of medical cannabis. As of January 2024, 48 cannabis cultivation or production licences and 27 manufacturing licences were held by medical cannabis companies in Australia.

Medical cannabis users face some difficulties when it comes to accessing the drug. Patients can only receive medicinal cannabis products via a specialist and then may have to wait up to a month for government approval. Still, a 2021 survey of medical cannabis users showed that legal medical cannabis use is on the rise in the country; 37 percent of respondents had a legal prescription for cannabis compared to just 2.5 percent in 2018.

How to invest in ASX cannabis stocks?

Australia’s cannabis space is still in its early stages and hasn’t hit its peak. More cannabis stocks are expected to list on the Australian Securities Exchange (ASX) in the future, which means more investment opportunities.

Elixinol Wellness (ASX:EXL,OTC Pink:ELLXF) was formed in 2018, when Colorado-based Elixinol partnered up with Hemp Food Australia to form an international brand and launch an initial public offering.

While Hemp Food Australia manufactures and distributes hemp food and skincare products, Elixinol is a retail provider on the CBD side of things, with dietary supplements and topical cannabis products. Elixinol has focused on building a solid global footprint with operations in the Americas, Europe and Asia.

In its latest quarterly report, Elixinol reported improvements to group revenues, which were up 76 percent from the same period last year for a total of AU$3 million. Australian brand revenues came to AU$2.5 million, up 140 percent.

Elixinol completed its acquisition of Ananda Food in early 2024, further solidifying its strong position in the Australian hemp market, while adding complementary products to its range of offerings.

Another big player in the budding Australian cannabis space is Cann Group (ASX:CAN,OTC Pink:CNGGF). Established in 2014, Cann Group was the first cannabis company to be issued a cannabis research licence and the first to be granted a medical cannabis cultivation licence by the Australian government.

The company has since worked to develop and supply cannabis, cannabis resin and medical cannabis products to patients for everything from multiple sclerosis to chronic pain. It does so using its own dry cannabis flower, which puts it ahead of the pack in a market that is still largely driven by imports. Cann Group has the capacity to produce 12,500 kilograms per year of dry cannabis flower for international and domestic medical cannabis markets at its Mildura growing facility in Victoria, which it completed in 2022 with support from the National Australia Bank.

There is also Althea Group (ASX:AGH), a producer, supplier and exporter of pharmaceutical-grade medicinal marijuana; it received its licence to cultivate medical cannabis in 2018. Currently, the company operates in regulated medical cannabis markets, including Australia and the UK. In late 2020, it received approval to sell cannabis products in Germany. The approval made Althea Germany’s first commercial supplier of made-in-Australia medical cannabis products. The German medical cannabis market is expected to be worth approximately AU$594.8 billion by 2029, as per Statista.

For the first three quarters of its 2024 fiscal year, Althea reported a record AU$26.6 million in cash receipts, with AU$8.4 million (AU$4.2 million each from recreational and medicinal) in the quarter ended on March 31.

Some of the largest names in Canada’s cannabis landscape, such as Canopy Growth (NYSE:CGC,TSX:WEED) and Aurora Cannabis (NYSE:ACB,TSX:ACB), have operations in the region as well.

In 2018, Canopy launched Spectrum Cannabis Australia, a medical cannabis company. Now called Spectrum Therapeutics, the company, which remains a subsidiary of Canopy, states it is developing “innovative cannabis-based products to create a range of effective formulations and delivery mechanisms and research their therapeutic effects.”

Aurora has a partnership with MedReleaf Australia, a pharmaceutical cannabis company, and together they provide Aurora’s products using their MedReleaf Concession Scheme. The program supports “those with Pensioner Concession Cards, Commonwealth Seniors Health Cards, Health Care Cards, and Veterans Cards” and offers compassionate pricing.

Further offerings are coming to Australia from Aurora Cannabis, the company announced in late April, including a new range of premium dried flower products.

What’s the outlook for cannabis in Australia?

According to Future Market Insights, Australia’s legal cannabis market — a category that includes medical cannabis and hemp products — is projected to experience a CAGR of 30.1 percent into 2033 to reach US$828.2 million in revenue.

Alongside the legalisation of medical cannabis was the legalisation of overseas exports in 2018, and Australia had big plans for the growth of its international presence at the time. “We’d like to be potentially the world’s number one supplier,” said Australian Health Minister Greg Hunt on a local radio station that year. This has yet to come to pass; the 10 largest cannabis companies are all located in either Canada or the US.

There has been talk about the legalisation of cannabis for recreational use in response to growing support for complete cannabis legalisation across the country. In August 2023, a senator put forth the first federal cannabis legalisation bill in Australia, called the Legalising Cannabis Act 2023.

According to the bill’s summary, if passed, it would establish “the Cannabis Australia National Agency as a statutory agency to register cannabis strains and regulate activities relating to cannabis including: growing and possessing cannabis plants; manufacturing and selling cannabis products; operating cannabis cafes; and importing and exporting cannabis products.” There will be a public hearing for the bill on May 31.

Overall, the growth of the country’s medical cannabis industry — and the Australian marijuana companies that exist within it — is a growing opportunity. While recreational cannabis remains illegal, moving forward investors should keep an eye out for updates on the Legalising Cannabis Act 2023.

This is an updated version of an article first published by the Investing News Network in 2019.

Don’t forget to follow us @INN_Australia for real-time news updates!

Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.


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