Players in the cannabis production industry have called for review of licensing fees and other requirements to enable smallholder farmers to participate in the production of the crop that is touted to complement tobacco.
Speaking during a cannabis symposium organised by Farmers Union of Malawi (FUM) in Lilongwe on Tuesday, the stakeholders argued that the regulatory requirements discriminate smallholder farmers, who comprise the majority of the farming population in the country.
FUM chief executive officer Jacob Nyirongo said cannabis has emerged as an alternative crop to tobacco; hence, the need for government to ensure the value chain takes an inclusive process.
He said the symposium was organised in response to last week’s call by President Lazarus Chakwera during the opening of this year’s tobacco marketing season in Lilongwe that stakeholders in the agriculture sector should find alternatives to the dying tobacco industry.
“It is a new crop and there are challenges, the conditions that farmers are supposed to meet to grow the crop are quite difficult,” said Nyirongo.
Licence fees to cultivate, sell and process medicinal cannabis is pegged at $10 000 (about K7.4 million) while licence fee to cultivate and sell industrial hemp is pegged at $2 000 (about K1.4 million).
On the other hand, a licence to process industrial hemp is pegged at $5 000 (about K3.7 million).
Other requirements are that farmers should present a business plan to the Cannabis Regulatory Authority and have readily identified markets.
Stakeholders believe small-scale farmers will be excluded from production while rich and external investors will reap the benefits.
Cannabis Regulatory Authority director general Ketulo Salipira has called for patience, saying people should understand that the sector is in its infancy and that some challenges will be resolved along the way.
“If you talk about higher fees, we have actually arranged with farmers to form cooperatives and farmer clubs to be in groups from 10 up to 100 and share licence fee costs,” he said.
So far, the authority has approved and issued licences to 36 applicants intending to undertake various activities of the value chain.
An analysis by Invegrow Limited, one of the local firms that grows cannabis, found that a kilogramme of industrial hemp can fetch about K32 000 on the market and that there is potential for direct annual benefit to Malawians in excess of K3 billion on 16.5 hectares.
The analysis further indicated that the crop has ready markets whose global value chain is worth about $9 billion (about K6.6 trillion).