In the east German countryside, close to Dresden, a former abattoir is now home to the biggest indoor cannabis farm in Europe.
Behind the recently renovated concrete walls, German start-up Demecan has been growing marijuana in accordance with the law for the past year.
The company is one of only a handful in Germany to have a license for the production of “green gold,” which has been legal in Germany for medicinal use since 2017.
Photo: AP
However, the budding industry is eyeing a bigger prize: German Chancellor Olaf Scholz’s government plans to legalize the drug for recreational use as soon as 2024, which would leave it with one of the most liberal cannabis policies in Europe.
Inside the building, the smell of the plants — lined up in their hundreds under yellow grow lamps — is overwhelming.
“We will have the option to expand the facility to cultivate recreational cannabis,” Demecan managing director Philipp Goebel said.
The government coalition, led by Scholz’s Social Democrats, has put forward a road map for the legalization of cannabis with a target date of 2024.
Under the draft plans, adults would be allowed to hold a maximum of between “20 and 30 grams” of cannabis for private consumption via a network of licensed stores and pharmacies.
Demecan’s massive complex, which covers about 120,000m2, produces 1 tonne of cannabis a year, but it has yet to reach capacity.
The company could quickly increase production “10-fold” to meet growing demand, Goebel said.
Harvests at the farm happen every two weeks, with workers plucking the flowers from the plant stems before they are dried.
“I like this job a lot, it is not like any other,” said 34-year-old Sven Skoeries, who studies horticulture alongside his responsibilities at the farm.
Demecan has no trouble recruiting for its growing business in a region otherwise marked by an aging population and lack of workers.
“It’s a trendy product that generates a lot of interest,” Goebel said.
“It’s a new industry, that’s interesting for me,” says Jana Kleinschmidt, 25, as she snips off leaves with a pair of scissors.
As well as its own production efforts, Demecan has a license for annual imports of 20 tonnes of cannabis from Canada.
“We are currently supplying 55 percent of the German market,” Goebel said, adding that his firm is in “pole position” to capitalize on legalization.
The recreational cannabis market in Germany is a potential 4 billion euros (US$4.2 billion) business, a study by the Heinrich Heine University in Duesseldorf showed.
In the past few months, fundraising in the sector has taken off as businesses await the green light from lawmakers.
Berlin start-up Cantourage, a manufacturer of cannabis-based medicines, last month floated 15 percent of its shares on the Frankfurt Stock Exchange.
Cansativa, the only online platform for the sale of therapeutic cannabis products in Germany, raised US$15 million in February with the help of US rapper Snoop Dogg.
Sanity Group, a German company that focuses on cannabis-derived products, likewise raised US$37.6 million in September.
Legalization looks like a good deal for the government, too.
The Heinrich Heine University study estimated that the move would boost public finances by 4.7 billion euros per year.
However, the idea remains controversial.
At the end of October, German Medical Association head Klaus Reinhardt called the plans “almost cynical.”
It was “shocking” to legalize a substance that could “lead to behavioral problems in adolescents, as well as addiction and psychological changes,” Reinhardt said.
Opposition parties have also set themselves against the move.
Bavarian State Minister of Health Klaus Holetschek, a member of the Christian Social Union party, called the idea “a dangerous signal for all of Europe.”
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