The initial R100 million investment of the indoor cannabis cultivation project by Medigrow at the Coega special economic zone in Gqeberha – which is part of the group’s five-year R1 billion investment – begins next week with the distribution of hemp seed to the nearly 30 selected Eastern Cape rural farmers.
The event will mark the launch of the province as the country’s cannabis industry hub.
Imported equipment valued at R30 million is already on site, awaiting assembly in readiness for actual production which starts next month (February). The initial investment is for setting up the indoor cannabis cultivation facility, cannabidiol (CBD) extraction, packaging and cigarette manufacturing.
This is the culmination of the signing into law of the Cannabis for Private Purposes Act by President Cyril Ramaphosa on the eve of last year’s national elections. The law deals with, inter alia, the private cultivation, possession and consumption of cannabis by adults for private purposes; expungements of criminal records for cannabis-related offences; and other related matters such as cannabis use in relation to the rights of children.
The project, on a 10 000-hectare piece of land, will see the processing of cannabis into various medicinal products and oils, and will create about 30 000 job opportunities when fully operational.
Small-scale rural farmers currently growing cannabis illegally will now be properly licensed and given hemp seed to grow the cannabis plant which will be sent to the Medigrow processing plant where it will be processed into finished products for export.
Medigrow chief executive Edgar Adams, in an interview with City Press, said they had invested a lot of money into the project and so “there is no chance of it failing”.
He said that, after realising the medicinal properties of cannabis – and also driven by the death of his nine-year-old daughter due to cancer – he committed himself more deeply to the development of the cannabis industry.
“The project is going smoothly and moving according to plan, and there is great commitment and buy-in from the Eastern Cape provincial government.
“We are handing over hemp seed to 28 selected and licensed rural farmers on 27 January. The equipment valued at R30 million is already on site and actual production starts next month (February),” Adams said, adding that the end products would be earmarked for export markets such as the US, Europe and Australia.
Adams said workers union Nehawu, through its holding company Nehawu Holdings, was also a shareholder in Medigrow.
Adams added:
The products processed from the dagga will be CBD isolate; and tetrahydrocannabinol (THC), the psychoactive part of the hemp plant which also has numerous other medicinal uses.
The Coega project is called Instango Extraction. Ntsango is the isiXhosa name for marajuana.
In supporting the project and ensure its success, the Eastern Cape government says it will procure six tons of hemp seeds, 1 000 litres of herbicides, 1.3 tons of fertiliser and fencing to assist hemp farmers who will make money by selling the cannabis to Medigrow for processing.
