One of the two marijuana producers in Uruguay is betting that the hemp market will be more lucrative than the market for its psychoactive cousin, due to less government regulation of the plant and its overall manufacturing potential, according to a report from Bloomberg.
Cannabis cultivated by International Cannabis Corp. will hit pharmacy shelves within weeks but the company already has plans on diversifying their offerings to include hemp and will plant their first hemp crop next month, the company’s CEO Guillermo Delmonte said.
“Recreational cannabis is regulated by the government and we sell what the government lets us sell,” Delmonte said in the report. “In the hemp market we can produce all we can to meet demand.”
According to a February report by the Congressional Research Service, annual sales of hemp products in the U.S. are estimated at more than $580 million. The Agricultural Marketing Resource Center estimates that the value of hemp per acre in the U.S. is roughly $21,000 from seeds and $12,500 from stalks.
Simbiosys, the other company approved by the Uruguayan government to cultivate cannabis, plans on focusing only on marijuana for now. The companies will each produce as much as two tons of cannabis per year, but will compete with 5,000 registered home growers and 17 licensed cannabis clubs for market share in a country of 3.3 million people.
Pharmacies will pay the two producers $0.90 a gram for cannabis – as mandated by the government – and are allowed to charge a 30 percent markup to consumers.