Cannabis hopes go up in smoke

The department of health’s recent unilateral ban on all “foodstuffs” made with any part of the cannabis plant, including hemp and cannabidiol (CBD), is unconstitutional, ill-informed and an embarrassment for South Africa, industry experts have said.

Organisations working in the sector have demanded that the department reverse the prohibition immediately or face litigation. 

The department quietly gazetted the ban on 7 March, nearly two months after it was signed on 17 January, without public participation. This was despite President Cyril Ramaphosa flagging the opportunities linked to cannabis in his State of the Nation address last month. 

During a webinar on Tuesday, the director of food control at the department of health Penny Campbell said the ban prohibits labelling contents that contain CBD or tetrahydrocannabinol (THC) as “foodstuff”. 

CBD and THC are both chemical compounds found in the cannabis plant. CBD is known for its therapeutic uses, including to treat pain, anxiety and inflammation, and does not cause a high, while THC does have a psychoactive effect. 

Campbell said manufacturers and retailers must comply with the department’s labelling regulations, and other hygiene and safety regulations, for foodstuff.

“The intention is not to ban them, but to make sure that the contents of those products are acceptable, they are safe, and they are [kept] from children,” she said, adding that manufacturers were required to stipulate whether their products contained either CBD or THC, or components of the cannabis plant, to avoid misleading consumers. 

Hemp, another product of the cannabis plant, with a much lower THC content, has been touted for its multiple uses, including its nutritional value and industrial applications. 

At the webinar, Campbell said the department had decategorised hemp as a foodstuff because of “lack of evidence of its nutritional benefits” but lobbyists disagreed. 

“Saying they’re banning anything that’s made with any part of the cannabis plant is insane,” Friends of Hemp South Africa president Ayanda Bam told the Mail & Guardian.

He explained that hemp seeds can be milled into a powder that can be consumed in smoothies, cereals, soups or in drinks and can also be pressed into oils used in beverages, food and cosmetic products or dehulled and consumed whole. 

The seeds are rich in omegas three, six and nine and have a high protein content, with hemp powder and oil considered “superfoods”. 

The health department has “not done their homework, and that’s the challenge”, Bam said.

“We have such a big knowledge asymmetry and people are obviously going to make decisions that seem quite well informed, but are actually nonsensical, because they don’t understand the context. 

“They don’t understand the industry; they don’t understand the plant.”

In his State of the Nation speech, Ramaphosa said his government wanted South Africa “to be leading in the commercial production of hemp and cannabis”.

This week, experts said South Africa had massive potential to grow the market and trade with other countries but the ban would make it difficult to exploit this.

Bam said, even if the department decided to reverse the ban, South Africa’s image on the global scale had already been tarnished.  

The global hemp seed market was estimated at $5 billion in 2023 and is projected to double by 2032. 

The food and beverages component accounts for more than 55% of this value and is the fastest-growing segment as more consumers follow health trends.

The US, Russia, EU member states, Canada and China recognise, and trade, hemp grain as a food, Friends of Hemp South Africa said in a statement this week.

South Africa has more than 1 400 legally compliant hemp cultivation businesses and there are more than 400 small, medium and micro enterprises and at least five major retailers seeking to gain greater market share in the industry. 

“Based on a sample of only 10 existing representative businesses, the loss in inventory and monthly revenues amounts to more than R80 million and R25 million, respectively,” Friends of Hemp South Africa said.

“This pales in comparison to, for example, more than R4 billion already invested by government and hemp/cannabis businesses, pipeline investments in technology and infrastructure totalling over R5 billion to create more than 40 000 local jobs. 

“More than R2 billion has been committed to co-investments from international partners in technology transfer, skills development and project preparation and financing.” 

Hemp cultivator Ben Sassman, the founder of small business Hemp4Life, said the ban does not make the market feasible or attractive for anyone — even for the businesses and enterprises that had been granted permits — to cultivate or manufacture hemp products. 

“They spend more money than what they made. So, it’s not profitable, unless you process it into something, but now the government is saying that it is becoming illegal for us to use it in South Africa.”

The ban is a lost opportunity for South Africa to boost economic growth, create jobs and boost trade with other countries, said Tebogo Tlhopane, the founder and chief executive of Biomuti and chair of the Cannabis Trade Association of South Africa.

“We need to have laws that make sense — laws that attract investment, create growth, create jobs. 

“I projected that we could be creating about 4 million jobs in the entire cannabis value chain — and that’s being very conservative,” Tlhopane told the M&G.

“We need homegrown industries …We need to maybe start looking at how we start creating those opportunities at home. 

“We can make gummies, we can make all sorts of things. It’s important that we get those industries up and running with the proper support structures to make sure that they succeed and get a clear legislation that governs.”

The department of trade, industry and competition has put together a plan to support the regulation and commercialisation of cannabis, including manufacturing; market development; support for enterprise and supplier development; and regulatory reform; but lobbyists say this has been moving at snail’s pace. 

At this week’s webinar, a director at the department, Sinah Mosehla, told participants: “Those that are using cannabis to make foodstuffs will cease production. Those products in the pipeline will obviously have to stop because a ban is a regulating tool of the government.

“Companies need to comply but with the hope that soon the department of health [will] look at developing regulations that will guide how cannabis or hemp should be used into production, including how to label appropriately and how to market it.” 

She added that the trade and health departments would work closely together to develop a regulatory framework. 

The department of health had not responded to questions from the M&G by the time of publishing. 

The South African Health Products Regulatory Authority declined to comment, saying the ban had no effect on its mandate to regulate medicines or other health products.