After years of regulatory hurdles and slow government action, New Zealand’s industrial hemp sector is hopeful that long-awaited reforms could finally unlock the industry’s full economic potential. The announcement of a regulatory review by Minister for Regulation David Seymour signals a possible shift in the government’s approach to industrial hemp, a crop that has long been entangled in outdated legal restrictions.
The review, which aims to reassess regulations that classify industrial hemp as a Class C controlled drug under the Misuse of Drugs Act, marks a significant victory for hemp advocates.
“There’s a lot of interest in the industry and if we can capture that interest and really move forward and engage with our regions where the economic opportunities, employment and investment potential will be realized, then we’ve got a winning formula to revitalize rural New Zealand,” said Richard Barge chairman of the New Zealand Hemp Industries Association (NZHIA).
Unnecessary restrictions
Barge and others in the industry have argued that these restrictions are unnecessary given hemp’s minimal THC content and its broad applications in health, wellness, textiles, construction, and food.
The upcoming Cabinet review presents an opportunity to modernize New Zealand’s hemp regulations and align them with international best practices. Stakeholders advocate for removing hemp from the prohibited plant list, defining THC and CBD thresholds for various products, and creating a structured pathway for exports. They also emphasize the need for regional processing hubs to maximize value-added opportunities and support rural economies.
Minister for Regulation David Seymour said over-regulation had stifled economic growth and innovation within the sector, and it was time for a new approach that balanced risk management with unlocking opportunities for growers.
“The Ministry for Regulation has received extensive feedback on the red tape hindering the industry, both through its review into Agricultural and Horticultural Products and the red tape tipline,” Seymour said. “In response, the Ministry is working with MedSafe and the Ministry of Health to reassess these nearly twenty-year-old regulations,” which he called “outdated and burdensome.”
Unlocking economic potential
For years, hemp stakeholders have pushed for regulatory changes that would allow New Zealand to tap into the booming global hemp market. The NZHIA projects that, with the right regulatory environment, the industry could generate $2 billion annually and create 20,000 jobs by 2030. However, strict licensing requirements and classification under narcotics laws have stifled the sector’s growth, discouraging investment and innovation.
New Zealand’s current regulatory framework presents several challenges. Hemp-derived food products have been legal since 2017, but the lack of approval for hemp animal feed limits market development. Regulatory barriers also complicate access to international markets, putting local producers at a competitive disadvantage. In contrast, countries such as Australia, the United States, and members of the European Union have adopted more progressive policies, allowing broader commercialization of non-intoxicating hemp products.
Path forward
Despite the positive momentum surrounding the review, industry leaders remain frustrated by the slow pace of reform. The NZHIA first outlined the necessary changes in a 2020 report, but meaningful progress has been elusive. The industry’s concerns were reiterated last week before the Primary Production Select Committee, where Barge stressed that hemp should be treated as a standard agricultural crop rather than a controlled substance.
While the regulatory review represents a step in the right direction, its success will depend on the government’s willingness to enact meaningful reforms. As Barge put it, “The industry is ready to go. We just need the government to remove unwarranted barriers and let us compete on the global stage.”