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The Australian cannabis market is moving along as regulations fall into place for the sector to keep expanding.

While the current rules may make the market appear at a standstill, recent approvals show the momentum for a vibrant medical cannabis industry will carry on in 2021.

Even though companies on the ground don’t expect to see recreational use become legal throughout 2021, the medical cannabis market is still expected to continue ahead with stronger numbers.

Here the Investing News Network (INN) offers some key points on what may be ahead for the

Australian cannabis market

in 2021.

Australian cannabis outlook 2021: Medical still accounts for growth in the space

As part of its Oceania Cannabis Report: Second Edition

business report

, international drug research firm Prohibition Partners indicated medical cannabis will account for approximately 40 percent of the US$1.55 billion total the entire industry in Oceania is expected to be worth by 2024.

“Let’s build a very successful business based on medicinal cannabis… we’ve got to ride the global wave of global acceptance,” Brett Schwarz, CFO and corporate advisor with privately held firm Cannatrek told INN.

Schwarz explained it’s hard to project when exactly Australia may legalize recreational use, a key catalyst for the development of a cannabis market.

“We will one day, but we can’t say whether it’s in one year or five years,” said Schwarz. “There are more politicians talking about it, there are more doctors talking about it. that I think that it will come in time.”

The Cannatrek executive was cautious of expecting recreational cannabis to open anytime soon, instead opting to place his emphasis on what’s ahead for the medical market.

A

study

from FreshLeaf Analytics pegged the value of the medical market in Australia for 2020 at AU$95 million for sales in the year.

“Australia is a maturing market, not mature but maturing, and I think the patients are seeing that, so they’re feeling more comfortable,” Schwarz said.

In a portion of the study from Prohibition Partners, Roby Zomer co-founder, managing director and CEO of MGC Pharma (ASX:

MXC

,OTC Pink:MGCLF) said more education is driving up the number of patients realizing cannabis is the right choice for them, alongside with medical professionals becoming more comfortable prescribing it.

“This is not only driving legislation change around the world but driving demand for quality medicinal cannabis products,” the MCG Pharma executive said.

The trajectory of growth is clear to see for the medical cannabis marketplace in Australia. According to FreshLeaf Analytics, product availability has quickly risen in the latter half of 2020 to now offer patients 150 items.

The research firm also indicated at the end of 2020 there were 30,000 registered patients allowed to purchase medical cannabis in the country.

“Recent price decline has brought the illegal and legal markets to parity and has put us in line, from a pricing perspective, with more mature markets such as Canada,” the study indicated.

Australian cannabis outlook 2021: CBD set for 2021 push

In December, the Australian regulatory agency in

charge of the rules

of medical cannabis, the Therapeutic Goods Administration (TGA)

gave the green light

for low dose cannabidiol (CBD) to become available through over-the-counter methods without a prescription.

In the

document

, the TGA indicated this new ruling will officially come into effect starting in February.

“That’s very exciting, that’s the maturity,” Schwarz told INN about the TGA approval.

These products will need to be approved by the TGA and make it into the Australian Register of Therapeutic Goods (ARTG). According to the regulatory agency no products have yet made it.

Althea Group Holdings (ASX:

AGH

) CEO Josh Fegan

said

the company was glad to see the TGA’s decision to alongside allow these products for sale over-the-counter, to also increase the maximum recommended daily dose.

“This decision provides confirmation of that marketplace,” Fegan said as he confirmed his firm will be working to make products available through this ruling.

Australian cannabis outlook 2021: Investor Takeaway

Investors in the Australian cannabis market have watched the sector slowly develop over time to the place it is now.

Thanks to an expanding medical market the sector has much to look forward to. However, a growing potential for international export has become available for the sector as well.

Schwarz told INN cannabis companies in the country want to prove that Australia can be served by their operations at the same time that an international opportunity follows closely behind as his firm eyes exports to Europe and throughout Asia.

As companies continue to expand according to the market needs growing pains could be expected as these players set themselves up to capitalize on the patient growth in Australia.

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Securities Disclosure: I, Bryan Mc Govern, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.