The recent ban on hemp foodstuff has thrown a spanner in the extraction works of Medigrow’s plans to help develop an Eastern Cape cannabis economy.

Even though the ban has been rescinded, Medigrow says the uncertainty around Government’s policy on hemp has  derailed its efforts to attract the sizeable investments required to scale up its operations.

Medigrow  says that it cannot comment at this stage because “We are currently involved in sensitive negotiations to mitigate the negative effects of the ban.”

However, a senior source within the company told Cannabiz Africa on 14 April 2025 that “the  ban on the manufacture of foodstuffs containing any part of the cannabis plant effectively brought a halt to our operations, as our offtake agreement specifies that all activities must be legal in the country of production and the country where it is imported.”

The source said that what’s worse is that Government’s actions have spooked international investors who are now thinking twice about putting their money into South Africa.

“Our investors  have paused all further investment as a result of the uncertainty caused by the ban.  Unfortunately the uncertainty does not go away when a ban is reversed. “

Medigrow has invested substantially in building a ‘cannabis hub’ at the Coega Special Economic Zone outside Gheberqha. The facility, which has been under construction over the past few months is designed to process biomass from small-scale growers, cultivate indoor medical cannabis for export and manufacture value-added products, including packaging products destined for the European market.  

Medigrow’s partner in the venture is the Eastern Cape Government, which has committed R4 million to what has been heralded as one of the country’s flagship cannabis projects.  The partnership, which has the enthusiastic support of Eastern Cape premier Oscar Mbuyane, aims to eventually incorporate thousands of hectares of hemp cultivated by small-scale growers, and create secondary businesses within the sector that could generate over R6 billion a year for the province in the longer term.

Even before the unintended consequences wrought by the hemp foodstuffs ‘flip flop’, Medigrow’s plans have been beset by difficulties, primarily because of  misalignment between government agencies. 

Medigrow is assisting the Eastern Cape Hemp Growers Association with fulfilling offtake agreements with the assistance of the Eastern Cape Rural Development Agency which is managing the community liaison element of the project. However, the ECRDA, which purchased seeds from Medigrow to supply a select group of farmers, has run into opposition from the Mpondoland Cannabis Belt Farmers Association which is opposing the introduction of hemp seed into Mpondoland.

Medigrow says the distribution and recall of seeds – if they were ever recalled – was all handled by the ECRDA had nothing to do with Medigrow who’s responsibility is to make sure to ensure that specifications were met for the offtake orders.

Although there are various obstacles to be overcome, Medigrow anticipates buying hemp flower from permit holders in the next few months to process into isolate for export.

The company is also expecting two more of its facilities to come on line in the next two months, depending on SAHPRA’s inspection time-table. These are at Phokeng in the North West Province and Camperdown in KwaZulu Natal.

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