CBD Usage Rising in Japan Despite Drug Taboo

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NEW YORK, Aug. 16, 2022 /PRNewswire/ -- Japan may be known for its zero-tolerance cannabis laws and strong social stigma against the drug, but the sentiment towards CBD is quickly changing. CBD extracted from the seeds or adult stems of the plant is legal and is currently sold in vapes, drinks, and sweets at specialty cafes, health food stores, and even a shop in Tokyo's main airport. Japanese Ministry of Health, Labour, and Welfare is considering approving medical marijuana to treat conditions like severe epilepsy. According to a recent industry report, the Japanese CBD market is expected to become Asia's second-largest CBD market, reaching around US$2.13 billion by 2024. The increasing demand for CBD in Japan opens up opportunities for companies in the hemp and cannabis industry including Flora Growth Corp. (NASDAQ:FLGC), Sundial Growers Inc. (NASDAQ:SNDL), Tilray Brands, Inc (TSX:TLRY) (NASDAQ:TLRY), Aurora Cannabis (NASDAQ:ACB) (TSX:ACB) and HEXO Corp. (TSX:HEXO) (NASDAQ:HEXO).

Flora Growth Corp. (NASDAQ:FLGC) is a leading all-outdoor cultivator, manufacturer and distributor of cannabis products and brands who operates one of the largest outdoor cannabis cultivation facilities.

On August 15, Flora Growth reported its financial and operating results for the six months ended June 30, 2022. The company reported $14.9 million in revenue for the first half of 2022, a rise of 604% compared to H1 2021 and 117% from H2 2021. Meanwhile, gross profit increased to $7.0 million, an increase of 547% compared to H1 2021 and 363% compared to H2 2021. Flora attributed the growth to its House of Brands, the launch of numerous new brands in the US, and the commencement of sales in its Commercial Wholesale and Life Sciences business.

Some of the H1 2022 highlights from Flora Growth include the acquisition of JustCBD, signing a distribution agreement with Giant OTG Management to provide access to JustCBD products at US airports, increasing its European presence with the opening of a London office, receiving approval to sell JustCBD products on Amazon UK, establishing a brick-and-mortar JustCBD store in the Czech Republic with plans to launch more stores in Germany through its partnership with Greenyard, and acquiring the CBD brand Masaya to expand its Life Sciences business offerings. Flora also completed build out of its all-outdoor cultivation and on-site extraction facility producing distillates and isolates using flower grown at its outdoor operation in Bucaramanga, Colombia.