Village Farms Launches Cultivation at Its Second Dutch Facility

GRONINGEN – Village Farms International, Inc. recently announced the commencement of cultivation at its Phase II cultivation and processing facility in Groningen, the Netherlands, after receiving all required regulatory approvals.

The Groningen facility aims to hit full production capacity by early 2027, boosting the company’s maximum annual production capacity in the Netherlands to around 10 metric tons. That represents a 5x increase over what its first Dutch site, based in the nearby town of Drachten, was designed to produce.

The timeline for this expansion has spanned years. Village Farms entered the Dutch market through its majority-owned subsidiary Leli Holland, which holds one of only ten licenses issued by the Dutch government to legally produce and distribute recreational Cannabis to participating coffeeshops. The Netherlands’ Controlled Cannabis Supply Chain Experiment is designed to determine whether and how controlled Cannabis can be legally supplied to existing retailers. Under the program, the ten license holders are exclusively permitted to produce and distribute Cannabis to approximately 100 coffeeshops across ten designated municipalities, which are required to purchase solely from those license holders.

As of Village Farms’ Q3 2025 report, Leli Holland products were available in 91% of participating coffeeshops in the Netherlands. The Phase II build-out followed directly from that foothold.

The Groningen site was designed and built from the ground up specifically for cultivation. Special attention was paid to the odor control system, ensuring that nearby companies might just as well be neighboring a tomato cultivation facility – a nod to the operational discipline Village Farms carried over from its greenhouse agriculture roots. Leli Holland leveraged decades of horticultural experience, including LED lighting and proprietary genetics developed in Canada, alongside a cross-continental exchange of cultivation knowledge between the Canadian and Dutch teams.

The Netherlands expansion also feeds a broader international revenue engine. In Q1 2026, Village Farms reported international export sales of $14.6 million, up 171% YoY, driven by strong demand for EU-GMP compliant products in Germany, where the company holds three of the top five leading cultivars through its distribution partners. Netherlands-branded Cannabis sales during the same quarter increased 448% year-over-year.

Village Farms’ Groningen buildout illustrates something the European Cannabis market has been slow to demonstrate at scale: that a vertically integrated operator with genuine agricultural expertise can move from regulatory license to profitable production inside an untested government framework. With Germany’s medical market maturing and the Dutch experiment informing broader European policy, the companies that have built compliant supply infrastructure early are positioned to capture disproportionate share as those frameworks expand. Village Farms is one of a short list that has done exactly that.