South Africa Issues 1,110 Hemp Licenses: Is The Industry Leaving Small Farmers Behind?

By Lucía Tedesco via El Planteo

South Africa has recently issued 1,110 permits for hemp cultivation following the approval of the Cannabis for Private Purposes Bill. The facilitation of these licenses is part of the government's “master plan,” aimed at establishing and growing the cannabis and hemp industry in the country. The overarching goal is to promote economic growth, reduce poverty and create jobs.

The scheme proposed by President Cyril Ramaphosa and his team is built on nine pillars. These pillars include regulatory services, sustainable seed systems, research and development, producer support, market development, business growth, and education and awareness initiatives, among others.

Minister Ramokgopa's Insights On Regulation Progress

Acting Minister in the Presidency, Maropene Ramokgopa, confirmed ongoing regulatory efforts: “The Department of Health, through the South African Health Products Regulatory Authority, has concluded consultations on changes to the Schedules of the Medicines and Related Substances Act, 1965 (Act 101 of 1965).”

Additionally, the Agricultural Research Council (ARC) has developed two hemp varieties and is working on seed multiplication, preparing for the 2025 planting season. A certification system for hemp has also been approved, ensuring the quality and integrity of the varieties.

Hemp In South Africa: Impact On Small Farmers

Ramokgopa also highlighted support for small businesses. For instance, in Gauteng province, 10 micro-enterprises have received aid to develop hemp and cannabis-derived products, in collaboration with the Council for Scientific and Industrial Research (CSIR).

However, not all communities have benefited equally. Current policies have made it difficult for regions like Mpondoland to compete with more sophisticated urban operations.

“My grandfather sent us to school with money from growing dagga. Our parents even bought us cattle and clothes from growing … Everything has changed now,” shared Landiwe Msolongile, a 60-year-old farmer, in an interview.

Struggles Of Small-Scale Cannabis Producers

Small cannabis farmers have seen a dramatic drop in prices, with earnings plummeting from ZAR 2,000 ($113) per 20-liter bucket to just ZAR 500. This has led to a sharp decrease in income.

To make up for falling prices, farmers increased production, creating a surplus they struggle to sell, with some even burning their crops to manage the excess.

Compounding these challenges, droughts have worsened the situation. “We keep trying to plant but have no harvest. Sometimes the rain fools us and we think it has returned,” Msolongile lamented.

Adding to their woes, stronger, foreign cannabis strains have entered the market, reducing demand for indigenous varieties. Large companies operating in legal gray areas have also penetrated the South African market, selling more potent, cheaper cannabis in unregulated dispensaries.

Although the government pledged to support local farmers, the only legal avenue to participate in the industry remains costly and complicated. Despite the government's initiatives, these projects have yet to benefit regions like Mpondoland.

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