Canadian cannabis producer Aphria (TSE:APH) has today announced that it has entered into an agreement with a company in Argentina to supply them with medical cannabis.
The Argentinian company has requested that it not be named and that the financial details of the deal not be disclosed. However, the company is licensed to import, sell and distribute medical products in the country, and is in the process of acquiring a license to do the same with cannabis.
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Medicinal cannabis became legal for use in Argentina about a year ago, so the industry is still quite new. Cannabis oil, in particular, is seen as having medicinal benefits, so it is possible that Aphria’s range of four different cannabis oil products will form part of the supply.
Aphria CEO Vic Neufeld said of the deal: “We see tremendous potential for medical cannabis in several emerging markets in South America, including Argentina… Aphria will continue to expand its global leadership through strategic investments, partnerships and exclusive agreements such as this one.”
The deal makes Aphria — which is based in Leamington, Ontario — the sole supplier of medical cannabis to the importer, which is good news for the company. Particularly so, since it follows a period of lackluster stock performance in 2018 so far. Since January 9th, prices have fallen -38% from $22.89 to today’s current price of $14.19 (CAD). The deal has failed to stimulate share prices today — quite the opposite, in fact; Aphria stock prices are down -2.83% in 24 hours. Still, the potential for growth is there when supply begins, as well as when planned legalization occurs in Canada later this year.
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It is not the first time that Aphria has broken through into the international cannabis market. Earlier this month, the company reported plans to establish a 5,000-hectare cultivation property in Greece, in what would be a milestone in the European cannabis industry. In other news, Aphria yesterday announced that shareholders of rival cannabis producer Nuuvera have voted in favor of allowing Aphria to purchase all remaining stocks in the company that it does not already own, marking a step forward in its planned acquisition of the company.
Featured image: Kannabia
