Cannatrek is deploying an end-to-end industry blueprint, to provide a streamlined progression into the cannabis agri-tech industry. Our unique “seed to patient” model provides us a level of vertical integration and competitive advantage our competitors struggle to match. By securing greater market share through lower costs and capturing more value throughout the supply chain, Cannatrek is well-placed to become a leader in the Australian medicinal cannabis industry.
The seed to patient model
Australia’s medicinal cannabis industry is still in its relative infancy. Legislative approval was only gained in 2016, but in the short time since the market has grown quickly, reaching a value of approximately $30m in 2019 and expected growth continuing to $150m by 2021.
Our “seed to patient” model involves us becoming entirely self-sufficient within our supply chain, from research and production all the way to distribution to patients. This gives us control over quality, supply, price, and consequently profit; an edge we have over most other competitors who rely solely on imported cannabis.
Cost is the most significant barrier to more patients using medicinal cannabis. We are determined to be the lowest cost supplier of medicinal cannabis in Australia and it’s our unique model that makes it possible.
Cannatrek is one of the few Australian Medicinal Cannabis companies who actually grow in Australia. Our current output is between three to five tonnes per year from our 16,000 square metre facility in Brisbane, but plans for further growth in capacity are underway. The next big leap will come from our “shovel ready” project in Shepparton, Victoria: a new scaled 160,0000 square metre facility capable of producing a $500 million or more estimated value of product a year (160 to 200 tonnes) once at full capacity.
Shepparton has excellent growing conditions, with low humidity, long hours of sunshine, and plentiful access to water, making it the perfect spot for low-cost growing and high quality output.
Distribution is the other important part of our self-sufficiency plan. We have created Cannatrek Access, a low-cost entry-point for patients to book telehealth appointments with experienced medicinal cannabis doctors. We are also developing Cannatrek Plus, a digital health management platform which let us sell directly to patients, and gives us direct contact with doctors and pharmacists too. Most other growers resell or outsource the distribution and sales component of their business, causing lower margins and less resilience. Once again, Cannatrek’s unique model gives us an edge.
The international market
Nearly all medicinal cannabis in Australia is currently imported, making it relatively expensive. With Cannatrek’s facilities for local growing, we are able to significantly reduce the costs and supply the market with a less expensive product. While our growing operation scales up, our secure international suppliers mean we can build relationships with patients, doctors and pharmacists in the interim, wasting no time.
Once production is fully at-scale, however, Cannatrek will find itself with plenty of export opportunities. We are targeting offtake supply agreements in several international markets including Germany, Poland, UK, Italy, Malaysia, Korea, Japan and Thailand. Export markets will further strengthen Cannatrek’s resilience, providing diversified income streams and potential for further business expansion beyond simply exporting product.
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