The Cannabis Regulatory Authority (CRA) says it is receiving more applications for medicinal cannabis production from companies compared to groups of farmers who are applying for industrial hemp production.
So far, since licence fees were announced in November last year, CRA said it has formally received 35 applications, with over 20 applications coming from individual companies and the rest from farmer groups.
However, experts in the field feel this is an indication that licensing conditions are not favouring the majority of growers.
In an interview on Monday, CRA acting registrar Ketulo Salipira said having more companies on board should be good news for the country as they will be producing and adding value for export markets, earning the country foreign exchange.
He said: “The expectations are high out there, more so, the rainy season is advancing; hence, the CRA Board and the secretariat remain mindful of the need to speed up the process of issuing licences.
“We are receiving pressure from interested producers for licence approvals because they want to start production immediately.”
Cannabis production is bringing hope in the economy that it will complement tobacco, the country’s main source of foreign exchange.
Figures show that over a 10-year period, earnings from tobacco have dropped by about 45 percent.
The recently gazetted regulations show that applications for licences attract a non-refundable fee of $1 000 ( about K740 000) for medicinal cannabis while a licence for industrial hemp is pegged at $500 (about K370 000).
Licence fees to cultivate and sell as well as the licence to process is pegged at $10 000 (about K7.4 million) for medicinal cannabis while a licence fees to cultivate and sell industrial hemp is at $2 000 (about K1.4 million) while a licence to process industrial hemp is pegged at $5 000 (about K3.7 million).
In an interview, Nebert Nyirenda, director of Invegrow Limited, one of the firms that conducted research on industrial hemp, said on Monday that apart from less information dissemination to farmers, the fees are exorbitant and not favouring the majority of farmers in the country.
He said: “The requirements are not favourable to growers’ interest. The documentation to obtain the licence is too cumbersome for a common farmer to manage. There is need to customise licence requirements to suit the needs of local farmers.”
A recent analysis by Invegrow Limited found that a kilogramme of industrial hemp could 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 or K195 million per five hectares.
The analysis further indicated that the crop has ready markets whose global value chain is worth about $9 billion (about K6. 6 trillion), giving local investors a basis to take up cannabis production.