Canadian Cronos Group announced its results for Q4 of 2017 on Monday, 30 April.
In a press release where the company, which describes itself as a “vertically integrated cannabis group that operates within Health Canada’s Access to Cannabis for Medical Purposes Regulations and distributes globally,” announced a sales increase of $3.5 million, a staggering 636 per cent increase to $4.1 million for the total of 2017.
Among the projects Cronos highlighted in the press release accompanying the report it announced that it launched a strategic joint venture in Israel under the name “Cronos Israel”, with Israeli agricultural collective Kibbutz Gan Shmuel, to produce and distribute medical cannabis.
“Israel,” the Cronos statement said, “has an ideal growing climate for cannabis with abundant sunlight to support year-round greenhouse cultivation without the need for supplemental flower lighting.
“Cronos Israel anticipates producing high quality cannabis at significantly lower production costs than in Canada due to Israel’s favorable climate and Gan Shmuel’s skilled labor force, existing manufacturing infrastructure, and ample on-site water access.”
The Israeli Kibbutz – collective agricultural settlement – still has a thriving agricultural and farming industry. The members of the kibbutz have extensive experience in the farming of citrus fruit, as well as crops like peanuts, cotton, wheat and tomatoes.
Some of the factories founded by the kibbutz are among the oldest still in existence in the country today. Its produce is exported to countries all over the world and is experienced in exporting goods.
According to a report in Hebrew-language magazine Cannabis, the kibbutz expects a cost of production as low as $0.4-$0.5 per gram, less than half of the average cost per gram for the local medical cannabis market.
The deal between Cronos Group and Kibbutz Gan Shmuel is based on a yield expectancy of 5 tons annually in the first few years, with options to expand greenhouses to grow up 24 tons annually and ultimately a mammoth 100 tons of cannabis per year.
The kibbutz entered the deal in the faith that an Israeli government program to export medical cannabis will pass its final legal hurdles soon.