MJBizMag September 2020 - 76

AFFAIRS
FOREIGN
an independent regulatory space for
industrial-hemp uses. Baselga expects
the hemp-specific regulations to come
online soon and be similar to the U.S.
Farm Bill or European hemp laws.
Currently, there are about
50 Colombian hemp farms in operation,
and companies there have regulatory
hurdles to clear before they begin
exporting-starting with registering
their cultivars and strains with the
National Agronomic Agency. After that,
cultivators must obtain processing and
exporting licenses.
Baselga said CBD-rich cannabis
extracts are starting to be exported, but
industrial products such as fiber and grain
will take longer. Investment in fiber and
grain has been minimal so far, he said.
Colombia's tropical weather and
plentiful land make it ideal for low-cost
greenhouse cultivation year-round,
allowing growers to generate up to three
or four crops annually, Baselga said.
" I think for CBD we're certainly going
to be a main player, " he said.
One of Colombia's advantages-its
weather-is also one of its main
challenges. That's because the most
common cultivars for industrial hemp
don't perform well with year-round
tropical weather. But Baselga said
many companies are working on seed
genetics to find the right cultivar for the
equatorial climate.
Ecuador is one of the more recent
countries to legalize the sowing,
cultivation and harvesting of hemp,
as long as the plant doesn't have
more than 1% THC and is used with
authorization for medical, scientific and
research purposes. It also can be used
for industrial purposes, such as fiber for
textiles.
Ecuador is still very much a hemp
industry taking its first steps. Legislation
passed in 2019 formally took effect
this June. Still, there isn't a regulatory
framework officially in place. The
government has 120 days from June 21 to
formalize those, and it's possible they'll
be ready sometime in October.
Baselga of Savanna Ventures said one
advantage Ecuador shares with Colombia
is its weather, which allows for yearround,
low-cost greenhouse production.
" It really is just a very basic cost-benefit
scenario, " Baselga said. " It's impossible
that any U.S. grower or European
grower will be able to come even close
to production costs in ... Ecuador and
Colombia. "
One advantage Ecuador has over
Colombia is the ability to legally export
flower and biomass. Colombian law
requires biomass to be processed, and
only its derivatives or transformed
products such as oils can be exported.
" Eventually, farmers will be able to
start growing very cost-efficient, quality
flower and just export it. If they want
to process it, they can do that, but it
opens up a competitive advantage versus
Colombia, " Baselga said. " We can have
a situation where, in less than a year,
Ecuador is exporting mass bulk, quality
flower to whoever accepts it. "
The regulations in Ecuador also are
ECUADOR
2019 population: 14.7 million
2019 GDP: $107.4 billion
2020 Projected GDP (% change):
-6.3%
Source: World Bank and International
Monetary Fund
expected to be more streamlined and
easier to follow than Colombia's-another
possible appeal for investors.
When growing hemp for industrial
uses, however, Ecuador faces the same
challenge as Colombia: Hemp plants
grown for fiber don't perform well in
equatorial climates, so Ecuador has to
solve the riddle of plant genetics.
76 Marijuana Business Magazine | September 2020
LITHUANIA
2019 population: 2.8 million
2019 GDP: $54.2 billion
2020 Projected GDP (% change):
-8.1%
Source: World Bank and International
Monetary Fund
This tiny country roughly the size of West
Virginia is already one of the larger hemp
growers in the European Union, and
production could ramp up with pending
legislation that would allow farmers to
create products using the whole plant.
Lithuania grew 22,689 acres of
industrial hemp last year. That's double
what Germany produced-and Germany
is considered a major player in the EU's
hemp industry.
Currently, farmers can grow EUapproved
strains to produce hemp fiber
and seeds, but they cannot process leaves
or flower for anything other than research
and development. The sale of biomass is
permitted only internationally; the tops of
hemp flower must be exported, and CBD
products are illegal.
Those provisions are part of Lithuania's
first hemp law, which took effect in 2014.
However, legislators are working to
expand the plant's use. Under a pending
proposal, licensed hemp farmers would
be allowed to use all parts of the plant for
processing. Hemp-derived products that
contain less than 0.2% THC would be
legal to produce and sell, and they could
also be imported and exported.
The proposal passed two votes in
Parliament, but the bill stalled in April
as lawmakers looked to ensure their
regulations were compatible with EU
law. The European Commission and
EU-member states have three months to
examine the bill and respond.
MJBizMag September 2020

Table of Contents for the Digital Edition of MJBizMag September 2020
