Uruguay’s Cannabis Industry Struggles Amid Export Barriers, Price Drops
Uruguay, the first country in the world to legalize adult-use marijuana in 2013, initially made headlines as a pioneer in cannabis regulation. However, despite early momentum, the industry now faces significant hurdles in export growth, driven by low prices, international trade restrictions and regulatory obstacles. Today, the sector comprises nearly 100 projects and employs around 756 people, with 77% of the workforce based outside the capital.
Challenges Impacting Uruguay’s Cannabis
According to a recent article in Ámbito Financiero, half of the companies authorized for cultivation and industrialization in 2023 succeeded in exporting flowers and medical products. Yet, revenues fell sharply, with a 44% decline from the previous year, totaling just $3 million from 25 tons of hemp sub-products. The dip is largely attributed to low international prices, undermining the financial stability of many enterprises.
The industry remains dominated by small and medium-sized enterprises (SMEs), which account for 96% of the 90 active projects, while only 4% are considered large-scale companies. Despite these challenges, Uruguay managed to …