The future incursion of Costa Rica in a market that generates more than $5,000 million a year in the case of industrial hemp, was analyzed by specialists in this crop and medicinal cannabis. The activity took place at the Hilton Garden hotel in Santa Ana, this past week, with the participation of specialists from the local and international market.
The objective of the event was to bring international knowledge and experience on the subject so that it “permeates in the productive structure of the country” and understand how this industry works, said Roy Thompson, president on the Council of Hemp and Cannabis of Costa Rica.
He added that both hemp and medicinal cannabis are extremely high-value businesses. A greater advantage can be taken of them if, along with planting, the issue of industrialization is included to offer greater added value. He noted that it is a huge industry, but before sowing a seed, the parameters must be clear in order to compete.
“It’s not just about approving the law, but this is the beginning of a whole series of structures and regulations that allow us products that can be received in other markets,” said Thompson.
With the law approved at the beginning of this month, the organization it represents will fully focus on supporting the drafting of the regulations for its production and marketing. This is because if the standards that are established are not high, there is a risk that the products cannot be marketed in developed countries.
A great opportunity
Foreign entrepreneurs with an interest in investing participated in the activity, mainly due to its proximity to developed markets such as the United States and Canada.”The hemp and medicinal cannabis sector provide a great opportunity to strengthen Costa Rica’s position as a leading country in the cultivation of specialized and high-value products, generating employment both inside and outside the GAM,” said Pilar Madrigal, director of Cinde Investment Advisory.
Madrigal, who attended the forum to expose the country’s potential as an investment destination, pointed out the linkages that can be generated both in industrial hemp, as well as the use of medicinal cannabis in the life sciences sector.
Although there is potential to compete against other latitudes, she agreed with Thompson on the need to accelerate the regulatory processes in order for this industry to become a reality.
Market of more than $5,000 million
In 2020, a study prepared by the Foreign Trade Promoter (Procomer), indicated that the market for the sale of industrial hemp products alone exceeded $5,733 million and with a potential to grow 22% by 2025.
Industrial hemp can be cultivated as fiber, grain or CBD (cannabidiol that has among its properties to relieve muscle pain). The fiber is used to create bioplastics, textiles, and biofuels, among others. In the textile market, the world market, dominated by China, is estimated at $1,248 million.
Hemp grain can be used in food supplements or directly consumed from the seed, given its high nutritional value.Grain production, compared to CBD production, is less labor intensive and less profitable.Hemp can be grown for two or even all three purposes on the same site, but the quality of the fiber can be reduced.
The market for products with CBD such as supplements and beverages is estimated at $1,928 million with a growth of 57% in the 2016-2020 period, according to the Procomer study.Of the study, Thompson said it targets a more limited market, but there are now more than 25,000 products. This includes vehicle parts and paper.And if we talk about medical cannabis, the market is expanded by the diversity of products that would replace the pharmaceutical drugs that are currently used.
The law that legalizes the industrial use of hemp and the medicinal use of cannabis was approved on March 1st. It had the support of 35 deputies.The regulations had a first approval in January, but the Government vetoed the advance, especially with regard to self-cultivation.
Given this, the deputies had to adapt the text following the Government’s concerns. On March 2nd, President Alvarado signed the project as a Law of the Republic.With the publication of the law in La Gaceta, there is a period of 6 months to have its regulations. The Government promised to have it ready before the end of its functions on May 8th.
