Starting and scaling hemp farming projects in South Africa: challenges and strategies

In a groundbreaking move, South Africa officially recognised hemp as an agricultural crop in 2021, opening up new horizons for the cultivation of this versatile plant. The legal cannabis industry is one of the world’s fastest-growing and most exciting agricultural industries. The legalisation of hemp and the potential development of a legal cannabis industry has ignited expectations for inclusive economic growth and job creation in the country. However, while the prospects of hemp farming are promising, there are substantial challenges to surmount to fully harness the benefits of this emerging industry.

South Africa’s National Cannabis Masterplan 

Although South Africa’s National Cannabis Masterplan is currently being revised and under much discussion, its main objectives include:

• Increasing production, capacity, education and variety within the South African cannabis and hemp industries
• Ensuring progressive legislation is in place to support the planned growth

Challenges and considerations for hemp farming projects in South Africa 

As South Africa embarks on the journey of cultivating hemp, the industry faces an array of challenges that require careful consideration. 

Here are some of the most pressing obstacles and strategies to overcome them:

1. Regulatory constraints

The report underscores the inhibiting impact of existing regulations on the growth of the formal cannabis industry. While hemp and medical cannabis hold tremendous potential, the current regulatory framework poses substantial hurdles for businesses to navigate. The complexity of both domestic and international regulations hampers market access and hinders the growth of South African cannabis enterprises.

2. Inclusivity for hemp growers 

Achieving inclusive growth within the cannabis sector is a priority. The current regulations and licensing systems tend to favour larger players, potentially sidelining traditional growers and small enterprises. The transition to a legal cannabis and hemp farming economy must be carefully managed to ensure that those who have historically suffered from prohibition can also benefit from legalisation.

3. Hemp farming licensing systems

One of the pivotal issues to address is the licensing framework. A tiered licensing system that caters to both established hemp farmers and traditional growers could be a solution. By offering reduced compliance costs and simplified requirements for qualifying small enterprises, a more inclusive participation structure could be established.

4. Support measures for hemp farmers 

Lowering regulatory barriers for hemp farming in South Africa is only one piece of the puzzle. Traditional growers need support to enhance their capabilities and compete in formal markets. Access to state agricultural extension services, improved financing options, and the establishment of cooperatives or associations are essential for their success.

5. Hemp product specialisation

Niche hemp product areas could provide a lifeline for traditional growers, offering them opportunities to thrive in a competitive market. Ethical and sustainably produced cannabis, as well as landrace cannabis varieties with unique properties, could be avenues for differentiation and branding.

6. Demand support

Balancing supply and demand is critical for a thriving cannabis industry. Measures to compel larger processors to procure from traditional growers could incentivise demand. This could be enforced through industry charters, licensing conditions, or even mandatory sourcing quotas, as seen in other countries.

7. Protection of indigenous hemp farming knowledge

Preserving and benefiting from indigenous knowledge related to cannabis is imperative. Initiatives to catalogue landrace varieties, develop seed banks, and obtain intellectual property protections under indigenous knowledge systems can safeguard traditional grower communities from exploitation.

8. Zoning and contamination of hemp projects 

Zoning regulations that demarcate different types of cannabis and hemp production areas could prevent cross-contamination, ensuring the purity of landrace varieties and preserving their unique qualities.

9. Creating a hemp farming industry association

Establishing a  hemp farming representative industry association could be pivotal in guiding the sector’s development. This association could help coordinate efforts, access funding, and ensure the fair treatment of traditional growers.

Hemp farming projects are worth pursuing

The journey toward a thriving legal cannabis industry in South Africa is not without its challenges, but the potential benefits are too great to ignore. The path to success lies in a balanced approach that addresses regulatory complexities, promotes inclusivity, and supports the development of traditional growers. By crafting a tiered licensing system, providing targeted support measures, and incentivising demand for traditional grower produce, South Africa can cultivate a cannabis industry that not only fuels economic growth but also preserves its cultural heritage and fosters sustainable development.

As South Africa pioneers this new frontier, it has the opportunity to set an example for other African nations seeking to navigate the complexities of the cannabis industry. By learning from international models, leveraging indigenous knowledge, and fostering collaboration between government, industry, and local communities, the nation can unlock the full potential of hemp farming and create a legacy of prosperity and inclusivity for generations to come.