R40bn hemp opportunity could drive South Africa's green industrialisation, study finds

SOUTH AFRICA could unlock a domestic industrial hemp market worth as much as R40 billion by 2040 if the country moves decisively to develop the sector, according to a new study.

- SIPHELELE DLUDLA

THE study suggests that as a later entrant to the hemp market, South Africa could avoid many of the costly early-stage mistakes made by pioneer countries by building competitive value chains from the outset that align with international standards.

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The landmark industrialisation study was released by the Localisation Support Fund (LSF) in partnership with the Presidency, the Industrial Development Corporation (IDC) and the Department of Trade, Industry and Competition (the dtic).

The study outlines how hemp could become a significant driver of reindustrialisation, export growth, rural development and decarbonisation in South Africa, but warns that policy reform, financing and infrastructure investment will be essential to realise that potential.

Commissioned by the LSF and undertaken by Zageta Solutions in collaboration with the Development Policy Research Unit (DPRU) at the University of Cape Town, the research builds on the objectives of the National Cannabis Master Plan by translating policy ambitions for hemp into practical industry development actions.

LSF CEO Irshaad Kathrada said the findings demonstrate that hemp could become a strategic platform for South Africa's green industrial transition.

“Industrial hemp represents one of the most compelling and versatile economic opportunities available to South Africa right now,’ Kathrada said.

“With domestic demand alone projected to reach R40bn by 2040, the scale of the prize is significant. This study makes clear that legal reform, processing infrastructure, and demand-led value chain development must advance together, as part of a coordinated national programme.”