First Commercial Crop Commences in New Facility

Cannasouth Limited (NZX:CBD) has begun cultivation of its first full scale commercial crop of high-grade medicinal cannabis flower in its recently commissioned, state-of-the-art facility and has today released a video with CEO, Mark Lucas, providing a rare glimpse inside the unique to New Zealand facility. The video is available online at https://bit.ly/ccl_1stcrop The video covers the following key topics: Timeline: This fist crop will be flowered over the next 8-10 weeks. Commercial cultivation activities at this site, will continue year-round from this point, as we produce premium flower to supply both the local and global markets. Facility Design and Products for Market: Medicinal cannabis flower is produced in two product types; Bulk Start Material is flower that is used for further manufacturing of refined products such as oils, sprays or capsules. This type of flower is the easiest to produce and achieves the lowest pricing. Flower as a Finished Product is flower that is used by patients directly, either by being vaporised, or used as a tea. This type of flower has much higher quality requirements and generally requires production in dedicated facilities with pharmaceutical quality, post-harvest processing areas, and GMP accreditation. Cannasouth designed its facility to target the premium flower market. Demand: Mr Lucas says "Many patients accessing medicinal cannabis from the black market, are using flower directly. As a result, when they transition to the legal prescription market, they often seek flower to maintain a consistent therapeutic effect. "Flower in the finished dosage form category often has more in common with a connoisseur wine than a traditional pharmaceutical in terms of consumer preference. Flavour profiles, and strain characterises, are important to many patients." Flower remains a very popular format in developed medicinal cannabis markets. In Australia, nearly 40% of all medicinal cannabis prescriptions are for flower. "We believe, flower will be a popular format in New Zealand as well, once more product options become available, including those produced locally, and pricing improves." What's Next: Next steps for Cannasouth include; o GACP and GMP accreditation for the cultivation facility o Completion of distribution and offtake agreements for first cannabis flower exports, currently under negotiation o Sales of initial imported finished products, once approved by the Medicinal Cannabis Agency, for New Zealand patients -ENDS- For further information visit www.cannasouth.co.nz or contact: Mark Lucas CEO / Managing Director Email: mark.lucas@cannasouth.co.nz Mobile: +64 (0)21 484 649 Colin Foster CFO, Cannasouth Limited Email: colin.foster@cannasouth.co.nz Mobile: 027 577 1498 End CA:00389847 For:CBD Type:MKTUPDTE Time:2022-03-31 14:16:09