Portugal has spent the last few years cultivating a reputation as Europe’s gateway to medical cannabis. Exports are booming, the government and local media portray a very vibrant sector with fertile land, progressive laws and a soft regulatory environment.

But behind the glowing export figures, there is growing concern that the country’s success story is due to what some describe as “greenwashing” of the industry.

According to a person familiar with the matter, most of the cannabis that Portugal “exports” is not grown in Portugal. Instead, large companies import low-quality flowers from abroad, process them locally, and then ship them with a Portuguese flag on the label. “Portugal has exported about 35 tons of medicinal cannabis flowers so far,” says the source. “Only about 2 tons were processed here. The rest came from elsewhere.”

The concern is not the import and processing model itself, but the lack of transparency and its impact on the local growers who actually cultivate the plants in Portugal. “They grow cheap overseas for recreational markets,” the person says. “It is then processed in Portugal and sold in pharmacies across Europe at prices that are impossible for real growers. This is clear price dumping.”

Portugal grew on the cheap
According to the source, some European pharmacies are offering Portugal-labeled medical flower for as little as 1.60 euros per gram. Insiders say even the lowest-cost foreign producers can’t get that price and still meet European pharmaceutical standards. “The cheapest production cost I have seen abroad was around 1.40 euros per gram,” explained the source. “Processing in Portugal alone can cost about sixty cents. So how do they sell it for 1.60 euros?” According to them, the reason is simple. On the one hand, these big companies have to show their shareholders that they are moving money and product. On the other hand, they use the availability of capital to drive down the price, gain more market share, and crowd out smaller companies, which are ultimately bought by the same big companies. At the same time, the issue is not only related to the economy. Local producers say quality is also at stake.

Some sources say that many pharmacies turn away from the product with the Portuguese flag, knowing that it is not the real product produced in Portugal. “They think that Portugal is the equivalent of low-quality flower. This hurts the companies that really work here with strict European pharmaceutical practices,” says the person familiar with the matter.

Small farmers struggling to survive
Portugal has a large number of licensed cannabis operators, but few are growing at scale. According to the source, of all the cultivation licenses issued, only a few are actually operational. “Some growers produce one to three kilos per harvest,” says the person. “They have no strategy, no supply chain. It’s just a facade to show that they are somewhat operational, while in fact most of the products are imported and processed locally. These people entered the space without knowing how to run a medical cultivation project.” According to the insider, companies rushing to import, rebrand and dump products on the market are not building a sustainable sector in Portugal.

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“I expect six to eight companies to fail next year,” they say. “Everybody smiles at conferences, everybody talks about innovation. Nobody talks about cooperation.”

Pressure on regulators and call for research
The person says that regulators are to blame for the situation, but insists that the responsibility lies with companies that lack due diligence and compliance. “Regulators apply the rules. They are not there to do due diligence on behalf of companies,” they say. “Some companies had problems because they had false import documents from foreign suppliers. They blame the regulators for that, and the responsibility should lie with the operators in question, not having the right people doing the right compliance work.”

The source said there are plans to file a complaint with the European Commission under Regulation 2017/1036, which covers dumping of imports from the European Union when it causes injury to a domestic industry. “We are gathering evidence,” they say. “We want regulators to suspend import licenses where dumping is taking place.”

Meanwhile, international monitoring systems are being tightened. According to the source, the EU and the United Nations are implementing new digital tracking and tracing requirements. “Everything will have to be registered. All legal documents, all import and export certificates,” says the insider. “This should be ready in six months.”

Crossroads
Portugal’s promise as the gateway to European cannabis is not dead, but the road ahead is becoming increasingly complex. The sector needs scale, collaboration and transparency if it hopes to avoid the boom and bust cycle seen in North America. “I have nothing against importing and processing,” says the source. “What I find unacceptable is selling a flower with the Portuguese flag when they don’t grow here.”