With latest decree, Argentina has chance to be leader in Latin-American hemp

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Argentina has set the THC limit for industrial hemp at 1.0% and established a “one-stop shop” for administration of the hemp and medical marijuana sectors under rules published this month.

The regulations, which follow passage of a law legalizing hemp and MMJ more than one year ago, reflect a major advancement in Argentina, long considered a potential hemp powerhouse in Latin America.

The rules, however, published by decree in the government’s official gazette Aug. 4., do not allow CBD production.

‘New age’ dawns in LatAm

Argentina’s cannabis framework allows hemp to move into the farming mainstream in one of the world’s major agricultural nations, can serve as a replacement for a shrinking tobacco sector, and lead to innovation in technology and product development, the government has said.

“The publication of this decree marks the dawn of a new age in Latin America when it comes to industrial hemp and cannabis,” said Lorenzo da Silva, President of the Latin American Industrial Hemp Association (LAIHA). “Argentina, due to its geographical positioning and land availability, long history in agriculture and a commodity-centered economy, is the most suitable country in all of Latin America to develop a sturdy and sustainable hemp industry.”

‘Clear advantages’

According to the decree, “the gradual advance towards the legalization of the medicinal, therapeutic and palliative use of cannabis, as well as the reconsideration of the potential of industrial hemp has given rise to a dynamic industry that involves initiatives from the public, private sector and from organizations of civil society.

“Our country has clear comparative advantages for the development of medicinal and industrial cannabis, due to its scientific and technological capacities in agricultural and industrial matters, as well as the favorable climatic and soil conditions of the national territory,” the decree observes.

ARRICAME’s mandate

Under the rules, licensed producers will be able to market cannabis-based products and export them under the newly formed Regulatory Agency for the Hemp and Medicinal Cannabis Industry (ARICCAME), which is to serve as a central clearinghouse for administration of the cannabis industry.

ARICCAME has a broad mandate to reintroduce hemp in Argentina, promote research and technological progress, ensure consumer safety and cooperate with state agencies and universities. It is designed as a one-stop system that will provide greater efficiency by unifying administrative procedures, and facilitating access to information, according to the decree.

The agency will benefit from the input of a 20-person advisory council made up of representatives from scientific, technical and civil society organizations. Fully half of that council and half of the ARICCAME administrative staff must be women or transexuals, according to the guidelines.

“It should be noted that articles dedicated to the prioritization of projects that respect gender equality as well as the development of regional economies make Argentina a pioneer worldwide,” Maximiliano Baranoff, Director of Innovation and New Businesses at Industrial Hemp Solutions, said of the new framework.

1% THC but no CBD production

But the rules exclude the production of CBD, which is restricted under a 2020 decree that made CBD- and THC-based products legal to import but only for patients, with sales restricted to pharmacies under doctor prescriptions. “CBD cannot yet be commercialized for the internal market,” Baranoff said of the current rules.

By setting the THC level for Argentinian hemp at a full 1.0%, Argentina follows in the footsteps of leading hemp nations around the world who are going beyond the widely accepted global benchmark of 0.3% THC as the dividing line between hemp and marijuana.

Hemp stakeholders desire higher levels of THC for two reasons. First, CBD rises in proportion to THC in hemp, making CBD production more efficient. Second, the higher level shields farmers from problems with “hot” or over-the-limit crops grown for grain and fiber; in some parts of the world, such “hot” crops must be destroyed.

Inter-agency cooperation

ARICCAME is working in cooperation with authorities that oversee sectors in which hemp can play a role, and under frameworks in food, drugs, medical devices, and cosmetics; inspection and certification of agricultural products; registration and control of cultivation seed; research and development of agricultural technologies; testing and certification of industrial products; collection of taxes; and the accreditation and supervision of laboratories that perform food tests.

The government said its goal is to diversify production in regional economies by formalizing the cannabis industry and creating sustainable, environmentally friendly production chains – from growers and producers to the end consumer, embracing transporters, processors, distributors and commercial agents in the grain, textile fiber and construction sectors, and to create “quality jobs.”

According to the decree, the government has an “aim to promote development of productive capacities, promote the impulse of the regional economies, contribute to the reconversion of existing agricultural activities, substitute imports, and tend to the generation of quality jobs in the development of the sector.”

Jobs & ‘decent wages’

Gabriel Giménez, an ARICCAME board member, said “there is no possibility of industry development without a federal perspective of support for regional economies. We have the opportunity to create quality employment, impact on the domestic market, and, above all, decent wages . . . and the responsibility to bring industrial hemp to small and medium-sized producers.”

The government is advancing a whole-plant strategy for hemp that aims to exploit the crop for its health and environmental benefits in addition to its potential for economic development.

Permitted uses include human and veterinary medicines, nutritional, cosmetic, and industrial, as well as future applications which may emerge from ongoing research and technological development.

Market potential

Map of Argentina

Stakeholders see markets in hempseed as a superfood, and have suggested that Argentina could produce oils, flours and proteins from hemp grain. Fiber markets for construction materials, textiles, cellulose and bioplastics can also be exploited, authorities have said.

The government is supporting trials of 15 grain and fiber varieties which can be included in the country’s official seed catalog.

“Most of the country’s arable lands are located in latitude zones that are suitable for growing pretty much all of the Chinese, European and North American varieties currently available, therefore ignoring completely the biggest problem we see in other LatAm countries, which is the lack of suitable industrial hemp varieties for lower latitudes and tropical climates,” said LAIHA’s da Silva.

Argentina’s Ministry of Science said earlier this year it intends to invest more than $106 million in 13 research and development projects in hemp and cannabis across six provinces. Also, the government last year created Cannabis Conicet, a technology company aimed at advancing the industrial hemp and medical cannabis sectors.

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