By / February 9, 2024

Canada Accused of Dumping by Israel for Its Medical Cannabis Exports

In the global medical cannabis market, Canada has established itself as a leading figure and a pervasive player. Having been active in the medical cannabis sector for a long time, Canadian producers have taken advantage of international demand and have become the main exporters of medical cannabis, sometimes to the detriment of local players who struggle to compete. Now, it is attracting the scrutiny of Israeli regulators who have started into an investigation in potential dumping practices.

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Allegations of Dumping in Israel?

Israel, also known for its research on medical cannabis, has raised concerns about the impact of Canadian imports on its national industry. The Israeli Ministry of Economy has thus launched an “anti-dumping” investigation into Canadian cannabis companies following complaints filed by Israeli growers. The investigation focuses on allegations that Canadian imports at low prices are lower than local prices, causing financial losses and destabilizing the market.

The Core of the Dispute

The heart of the dispute lies in the pricing strategies of Canadian companies. While medical cannabis is sold at higher prices in Canada, it is reportedly offered at significantly lower prices when exported to Israel.

This practice, known as dumping, has sparked outrage among Israeli producers who feel unfairly disadvantaged in their own market. The influx of cheap Canadian imports has led to “a fall in prices and unfair competition,” prompting Israeli authorities to take action.

In 2022, 84% of the 24,000 kg of medical cannabis imported by Israel came from Canada.

Spotlight on Canadian Companies

The dumping investigation has put the spotlight on several major Canadian cannabis companies, including Canopy Growth, Tilray, and Organigram. These companies, along with others, have been asked to provide information and evidence regarding their activities and pricing practices. The outcome of the investigation could have significant implications for Canada’s cannabis exports, with Israel remaining a major destination for Canadian cannabis-based products.

Broader Issues in Global Cannabis Trade

The tensions between Canada and Israel highlight broader issues in global cannabis trade. Despite the increasing legalization and acceptance of cannabis worldwide, regulatory barriers and protectionist measures continue to hinder free trade. While selling imported cannabis at reduced prices is not illegal in itself, it raises questions about fair competition and market integrity.

Market Access Disparities

Furthermore, this dumping case highlights disparities in market access between countries. While Canada enjoys a thriving cannabis industry and exports its products to many countries, including Israel, it maintains strict restrictions on imports. This asymmetry has fueled the frustration of Israeli producers, who demand a level playing field in the international market.

The outcome of the dumping investigation remains uncertain, but it already calls for greater transparency and better cooperation in global cannabis trade.

(Featured image by Alesia Kozik via Pexels)

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