Australian hemp’s future depends on building processing capacity, manufacturing and end markets that can attract private investment, according to a landmark Senate inquiry. A report on the inquiry, released this month, marks a shift in the national conversation from proving hemp’s potential to creating the policy and commercial conditions needed to build an integrated industrial supply chain.
The report from the Senate Rural and Regional Affairs and Transport References Committee follows a 12-month inquiry that drew 71 written submissions and testimony from growers, processors, manufacturers, researchers and other stakeholders across Australia. It recommends reducing regulatory burdens, developing a nationally consistent hemp framework, recognizing state licenses across jurisdictions and considering a federal definition of industrial hemp based on a 1% THC threshold.
“The next challenge is turning those recommendations into investment, manufacturing capacity and stronger markets that create lasting opportunities across the value chain,” said Matthew Lariba-Taing, president of the Australian Hemp Council, which has issued an investor briefing and analysis of the inquiry.
Manufacturing focus
Rather than treating hemp primarily as an agricultural commodity, the Senate committee repeatedly points to downstream manufacturing as the industry’s greatest opportunity. The report calls for expanded processing infrastructure, stronger product standards, and greater research into industrial applications. It also urges government procurement policies that help create commercial demand for hemp-based products, including a proposal to embed hemp-based products in public sector infrastructure and building projects under the Commonwealth Procurement Rules.
The inquiry also examines Australia’s hemp sector as a single value chain encompassing genetics, farming, processing, construction materials, food products and exports. It concludes that long-term growth will depend on coordinated investment across that chain rather than production alone.
Construction materials feature prominently among the report’s recommendations. The committee calls for the National Construction Code to be updated to include hempcrete and other hemp-based building materials, backed by formal fire ratings and a best-practices standardization process, along with a supporting standard to be developed under the Building Code of Australia.
Commercial outlook
The inquiry report identifies processing infrastructure as one of Australia’s principal constraints, and recommends a comprehensive industrial hemp research and development program through AgriFutures Australia that extends beyond agronomy into processing and manufacturing.
The report also points to carbon markets as an emerging opportunity, recommending formal measurement of the carbon carrying capacity of hemp-based construction products to support Australia’s positioning in low-carbon construction and future carbon accounting frameworks.
While many recommendations require further government action, the report suggests Australia’s hemp sector has reached a point where policy, research and commercial interest are beginning to align around industrial development. The challenge now shifts from demonstrating hemp’s potential to implementing reforms that can support commercial-scale investment, the report suggests.