For all the buzz it’s generating, legalized pot may not live up to the hype. At least not in Uruguay where limits on production and pricing is leading one of two producers to diversify into less regulated hemp.
Weeks before selling its first ounce of pot at pharmacies, International Cannabis Corp. is already betting that hemp - a variety of cannabis - will be a much bigger market than selling the psychoactive part of the plant, according to Chief Executive Officer Guillermo Delmonte. Hemp and its extracts can be used in food, cosmetics and medicine.
“Recreational cannabis is regulated by the government and we sell what the government lets us sell,” said
Delmonte, who worked in wealth management at Spanish bank BBVA before joining International Cannabis. “In the hemp market we can produce all we can to meet demand.”
The global market for hemp is set to grow beyond its current $1 billion as more countries legalize production, according to Medical Marijuana Inc., a publicly-listed marijuana grower in California. For a company like International Cannabis, that means expanding beyond Uruguay, which with a population of 3.3 million limits just how much pot can be sold. The company is already in advanced talks with five European and South American pharmaceutical and food companies to supply additives like hemp oil and hemp-based extracts for medical products, Delmonte said.
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