In a challenge to licensed cannabis producers in Canada, long the global export leader, a growing share of cannabis exports is coming from companies in South Africa.
Firms in South Africa enjoy lower production costs, but they’re also meeting European Union standards for pest control as well as EU-GMP requirements.
With European markets increasingly interested in GMP-compliant product that’s also non-irradiated, South African cannabis producers are mounting a direct threat to Canadian LPs, operators told MJBizDaily.
“South Africa is quickly becoming a serious exporter to Germany,” said Johan Slabber, the CEO of Nexus Pharma, which bills itself as South Africa’s first vertically integrated THC company.
Amid an ongoing medical cannabis boom, Germany is the world’s largest importer.
Last year, Canada provided more than half of Germany’s supply, but changes are coming.
For South Africa, “(m)ore of her cultivators meeting EU microbial standards could mean an even bigger jump in exports,” Slabber added.
Where are cannabis exports coming from?
South African quarterly cannabis exports to Germany grew by 24% last year to 1,379 kilograms in Q4 of 2025, according to data from the Germany Federal Institute for Drugs and Medical Devices.
With 1,045 kg of South African cannabis received in Germany in Q1 of 2026, the most recent data available, total exports this year are on pace to exceed last year’s annual total of 3,725 kilograms.
In Australia, another key market, recently released Office of Drug Control data shows that imports from South Africa jumped from 60 kgs in 2021 to 4,992 kg in 2024. Exports declined to 3,891 kg in 2025.
In the UK, shipments from South Africa expanded from just 421 kg in 2024 to 1,345 kg in 2025, according to Business of Cannabis.
What are the leading cannabis companies in South Africa?
South Africa cannabis production is mostly dried flower intended for these key markets in Europe and Australia. And it’s dominated by a few vertically integrated cultivators, according to Micaël Zollmann, founder of South Africa’s MedCan.
Zollman’s MedCan, an indoor, GMP-certified operation, was the first cannabis company in South Africa to ship high-THC flower to the UK in 2021, according to the South African Health Products Regulatory Authority.
Other South African cannabis operators of note include:
- Cilo Cybin Pharmaceutical, a division of Cilo Cybin Holdings and the only medical cannabis firm listed on the Johannesburg Stock Exchange. It’s the first firm to have the combined Good Agricultural and Collection Practices license, according to company CEO Gabriel Theron.
- Biogenetics Labs, a cultivator that runs GACP/GMP facilities set up to meet European market demands via product with a high cannabinoid profile and a focus on pest-free production that also doesn’t require post-harvest irradiation.
- Nexus Pharma, a supply-chain aggregator which offers South African agricultural and medicinal cultivators exposure to overseas markets by taking care of the international compliance, such as GMP
- Felbridge, which runs a 14,000-square meter cultivation facility and also sells tissue culture and certified genetics to other local licensed growers, enabling contract offtake deals for small growers who aim to enter the export market.
And all of these companies are exporting to Europe.
Why is South Africa winning the global cannabis export market?
Several advantages have helped ambitious South African cannabis companies grow exports quickly, operators told MJBizDaily.
Chief among them may be the ability to ruthlessly exploit the country’s cost advantages.
“The big problem faced by competitor producers in Europe is that the labor force there is extremely expensive,” Michael Mintchev, co-founder of Biogenetics, told MJBizDaily.
Labor and electricity costs in South Africa are roughly around $0.40 to $0.80 per gram, compared to $1.20 to $2.00 and up per gram incurred by indoor Canadian and European producers, he added.
Going forward, Biogenetics plans to expand with European-based cultivation operations. According to Mintchev, that will allow the company to “control” the supply chain entering Europe.
Most importers into Europe struggle with owning the tail end of the pharmaceutical distribution ecosystem, he added.
“We can ensure the products meet the perfect European pharmacopoeia methods for supplying clean medicine to patients no matter where they are,” said Mintchev, who predicted Biogenetics will start turning return on investment in 2029.
For Felbridge CEO Leslie Zetler, South Africa cannabis producers benefit from their environment: a highly developed agricultural scene at home: universities, testing laboratories and world-class agricultural expertise.
“Cannabis is a medical crop grown by farmers, not pharmacists,” he told MJBizDaily.
EU regulators are also keen to South African exports thanks to familiarity. They trust GMP certificates issued by the South African Health Products Regulatory Authority, Zetler said.
That means something beyond a race to the bottom on cost.
South Africa’s exporters are competing not on price, but on quality, said Mintchev, who touted his company’s use of mites for pest control rather than pesticides.
About 70% of South Africa’s exports to Germany and the UK is dried cannabis flower, including branded finished flower, he said.
“I don’t think South Africa is gonna be your low-cost provider,” he said.
What cannabis products is South Africa exporting?
Some would-be cannabis exporters have struggled to meet Germany’s peculiar standards.
For example, cannabis producers that irradiate their products must first obtain a specific permit under German health authorities’ Medicinal Products Irradiation Ordinance.
In response, Biogenetics said the company set out to cultivate a quality product rather than irradiate post-harvest – the industry’s default microbial control method, Mintchev said.
“The biggest gap in the export market is not the plant but the quality system around it,” Nexus Pharma’s Jabber noted.
To fill this gap, Nexus positioned itself as an integration between ag and pharmaceuticals, he said.
“At end of the day, you (must) export a flower compliant to the pharmaceutical supply chain,” he added.
Pharmaceuticals, rather than a flower market, is Gabriel Theron’s focus at CiloCybin, he said.
The company has positioned itself to extract bulk cannabinoid extracts in the form of active pharmaceutical ingredients for the pharma market, he said.
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Is South African cannabis flower high quality?
MedCan’s Zollman told MJBizDaily is focusing on the UK, where he’s carved a foothold into a market heretofore dominated by Canada, the Netherlands and Australia by flipping the white-label script – and exporting branded flower.
“For us, MedClan has always been proud to say, we’ve cultivated this flower,” he said.
That also means taking the “harder” road of marketing it themselves: sticking their brand identity on the prescription packaging in the UK to build long-term brand visibility with physicians and patients, he said.
“We’re gonna brand it ourselves, and we’re gonna put our name on it so that people know MedCAN.”
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