Israel has now made “medical cannabis farming” a recognized agricultural sector, opening the way for an expanding number of growers to receive government grants, training, and other support, as well as breaks on water quotas.

Eight growers have been licensed by the government, including Tikun Olam, Israel’s oldest medical cannabis clinic and production, and Breath of Life Pharma, according to ICan: Israel-Cannabis, a venture fund and technology incubator for start-ups in the medical marijuana business.

A third licensed grower, Cannabliss, specializes in growing cannabis as a product ingredient, not for smoking. The company’s edibles are used in epilepsy treatment.

Bazelet Group processes the cannabis grown by four out of the eight legal farms in Israel, including its own license holder CannDoc, Better and Siach.

The Israeli government sees a significant economic opportunity in medical cannabis. Various published forecasts peg the sector to be worth from $260 million to as much as $1.1 billion in 2022. Earlier this year the government allocated the equivalent of $2.8 million for more than a dozen studies on boosting medical cannabis growing.

An additional 37 farmers received preliminary permits earlier this year to build facilities to cultivate medical cannabis. According to the Ministry of Health, those permits are only for the “planning and construction of the farm and preparation for quality checks, without authorization for having possession of the drug,”

Farmers who are given further approval will need to obtain a special license to handle cannabis through the country’s Dangerous Drugs Ordinance. Scale is critical for Israel’s MMJ farmers, according to government analysts.

Their economic models show that growing cannabis — at a wholesale price of about $2.85 per gram — is only profitable when planting and harvesting a one-acre or larger plot. They estimate It costs about $430,000 to establish and manage a quarter-acre cannabis farm in the first 18 months or operation.

Green Market / AA Magnum Analyst Blog Site News 2017.


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