As global cannabis markets mature, countries with low-cost labour and export-oriented policies are emerging as pontentially big players in the production game.
Thailand has an expected compound annual growth rate of 58.3% from 2024 - 2030 in their legal cannabis market. This might just be a compelling early example of countries willing to look to producing cannabis to boost their economies.
What we’re witnessing may not just regulatory liberalisation.
Is this an economic signal?
Are more countries with a comparative advantage in low-cost, high-volume agricultural production preparing to treat cannabis like any other export crop?
- Thailand’s average agricultural labor cost is under $10 USD per day, compared to $20–30 per hour in mature markets like Canada, Germany, or the U.S.
- Greenhouse construction, energy, and land costs are all significantly lower, often subsidised or incentivised by governments looking to stimulate rural economic zones.
- The strategic aim? Low-cost, high-quality flower at scale. Think bananas, rice, or rubber, but regulated and cannabinoid-rich.
Now add in global economic uncertainty. If geopolitical tensions persist, and traditional trade balances continue to be disrupted, it's not hard to imagine larger, more opaque markets (yes, China) entering the cannabis game.
China already dominates in pharmaceutical precursors and nutraceutical manufacturing. It seems that cannabis might logically follow.
What happens to higher cost players?
Mature markets with historically high production costs (California, Canada and Australia's still-emerging growers) face a squeeze. They must now compete not only with each other, but also a potential global glut of cheap product.
It’s basic economics: as supply rises and demand stabilises, prices fall.
And profit margins vanish for undifferentiated players.
The Future Is Bifurcated
Producers will need to stake out defensible positions, which could include:
- Hyper-local, small-batch, craft quality: where terroir, genetics, and artisanal cultivation matter. Think Napa Valley, not Stanthorpe. These products may never compete on price, but they don’t need to. They win on story, effect, and experience.
- Pharma-grade manufacturing in industrial hubs: where infrastructure, regulatory sophistication, and biotech experience already support GMP-grade production. These are the Pfizers of cannabis, not the farmers' markets.
It feels like we are barreling towards massive oversupply and only those with either distinct quality or scale and compliance advantage will survive.
Everyone else will get commoditised out of the game.
This is cannabis though, so anything is possible!
Your thoughts?