Hemp arrived as seeds with the First Fleet and was grown on the shores of the Sydney Harbour by convicts. Banned across the country in 1937 and since slowly deregulated, the production of industrial cannabis and its versatile by-product, hemp, has steadily increased and progressive farmers are reaping the rewards.

According to Grandview Research, consumer demand for hemp products (which include rope, carpets, woven fabrics, oils for cosmetics, building supplies made from the stalk of the plant and seeds as a “super food” for humans and animals) has increased to form a global market worth over $4 billion.

Earlier this year, the Queensland Parliament passed changes to the Drugs Misuse Act 1986 and the Drugs Misuse Regulation 1987 to make it significantly easier for farmers to cultivate and grow cannabis for use within the hemp industry. These changes bring Queensland’s licensing regime for industrial cannabis into line with the rest of Australia. The production and manufacture of medicinal cannabis is still very tightly regulated by the Federal Government, though it is expected that there will be changes made to this regime after the next Federal election in 2019.

Before a crop of industrial cannabis is planted and grown, farmers are required to hold a Grower Licence which permits them to possess certified cannabis seeds, grow cannabis in a certain location, harvest and sell the cannabis crop on the open market and trade in cannabis seeds between other growers. Other licence classes exist for researchers and seed handlers to round out the industry.

Sharefarming with a hemp manufacturer or exporter is a common legal arrangement with the same principles applying to a hemp crop as to any other type of produce. Under a sharefarming arrangement, the farmer should ensure only certified seeds are supplied and planted and that the right type of licence is held to grow the crop.

Thynne + Macartney’s agribusiness lawyers have been at the forefront of the development of industries within agribusiness for 125 years and see the growth of the hemp industry as a significant opportunity for farmers into the next decade.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.