Cannabis companies are now allowed to export seeds, oil and raw material
Health & Biotech
Medical cannabis export legislation has been passed, but with such little fanfare that many in the industry were unaware the deed had been done.
Further, companies are also allowed to export ‘genetic material’ — seeds.
In January the federal government said Australian cannabis companies would only be allowed to export value-added products that had been made here.
“The Turnbull Government will now permit the export of Australian manufactured medicinal cannabis products,” Minister for Health Greg Hunt said in January when the changes were unveiled.
“This decision will help both the domestic supply and Australian producers by strengthening the opportunities for domestic manufacturers.”
The Narcotic Drugs Amendment (Cannabis) Regulations 2018 was passed on February 8, allowing medical marijuana products manufactured in Australia to be exported to a licensed recipient in a country which has legalised the product.
All exports must go through the Office of Drug Control (ODC).
Raw material has since been added to the export schedule. The Ministry of Health and Mr Hunt’s office have been contacted for comment.
Not just manufactured products
The first cannabis goods heading overseas are not manufactured goods but seeds.
Medical Cannabis Ltd boss Andrew Kavasilas told Stockhead he will be exporting seeds to Canada as part of a partnership with CannTab, which is interested in some of the Australian genetic strains.
Cann Group also has permission to export raw material.
“As a holder of this licence, the company can apply for a permit to export raw cannabis material and cannabis oil for analytical testing,” Cann said in its half-year report in February.
“The company intends to utilise the analytical services of Anandia Laboratories in Canada to complement the capabilities available to the company in Australia (subject to the granting of an export permit and reciprocal Canadian import approvals).”
ASX Pot Stock prices over the past three months:
The ODC’s website has been updated to emphasis that the new regulations do not include the export of “unprocessed” raw cannabis.
“The policy to allow export has been specifically designed to focus on enabling export of medicinal cannabis that has been manufactured, or of raw cannabis that has been dose controlled and packaged,” the regulator said.
Amendments not publicised
The amendments don’t appear to have been publicised. In some cases industry players appear to be finding out about the change by chance.
LeafCann CEO Elizabetta Faenza said she found out in February only because they were visiting the Office of Drug Control and were told it had passed the week before.
Mr Kavasilas says they found out last week that the law had gone through, because the ODC sent them an export licence application form.
Stockhead spoke to several analysts and executives who were unaware the change had come through.
“It looks like the federal government has been a little sneaky and have already passed the legislation through, without too much publicity?” said Niv Dagan from Peak Asset Management.
“Maybe Malcolm was too busy trying to fix the Australian cricket teams’s reputation, rather than making a formal press release on what could be one of the most lucrative export opportunities on a global basis?”
Originally exports of cannabis products and raw materials were banned in order to maintain supply for local use.
But with fewer than 400 patients able to access medical cannabis in January, almost two years after it was legalised, the government recognised that manufacturers and growers needed a larger market to sell to in order to sustainably grow.