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ABC News
05-05-2025
- Business
- ABC News
Australian Cannabis Cultivator Guild forms, calling for action on 'import-flooded' market
Australian farmers are warning of "catastrophic failures" in the medicinal cannabis industry if the government does not reduce its reliance on international imports. A newly formed alliance argues gaps in supply are being plugged by A country's permitted supply is decided based on its demand for medicinal cannabis, but it may require imports when it cannot meet that level. Domestic farmers say they could meet demand themselves, but due to rigorous and expensive licensing processes, local farmers say they are struggling to compete with cheaper imports. Some have outsourced parts of their business overseas in an attempt to compete, something that is driving up costs. The newly formed Australian Cannabis Cultivators Guild has warned of a "bleak reality" ahead if changes are not made to advantage local growers. ( ABC Rural: Laurissa Smith ) The Australian Cannabis Cultivators Guild was formed on the back of Australian farmers' concerns. Its membership comprises more than 80 per cent of domestic-licensed medical cannabis production. In a letter to the federal health minister, the guild warned of a "bleak reality" ahead. "Without change, we expect to see catastrophic failures across local cultivators, resulting in bankruptcies which will impact Australian supply in the long term," the guild wrote. " The current trajectory will end with few to no Australian producers and a market supplied entirely by imports from countries that don't allow reciprocal imports. " The federal health minister has been contacted for comment. The Therapuetic Goods Administration says it has brought in requirements for overseas manufacturers of medicinal cannabis, but local growers say they are still disadvantaged. ( ABC News: Scout Wallen ) The threats to Australian growers In 2023, 61 per cent of medicinal cannabis in Australia was imported, according to the Therapeutic Goods Administration (TGA). The TGA said in a statement it introduced requirements for overseas manufacturers, resulting in equivalent standards for all products supplied in Australia, regardless of where they're made. "This addressed Australian producers' concerns about lack of a 'level playing field', which placed a higher regulatory burden on them due to the requirement for them to manufacture under GMP [Good Manufacturing Practice] in Australia," it said. Tasmanian farmer Cade Turland said he and other farmers still faced inequities, believing overseas processes were not as lengthy or restrictive as those they had to undergo. Australian medicinal cannabis growers are concerned about what they say is an unequal market. ( ABC Rural: Laurissa Smith ) He said he worried imports were not regulated or tested as thoroughly as locally grown products. The TGA said all products must comply with the Australian Quality Standard for medicinal cannabis. Mr Turland said establishing a growing facility took anywhere between two and four years, meaning money was "tied up for a long period of time". He said Australian farmers pay about $50,000 annually to maintain their medicinal cannabis licenses, including costs like random and routine inspections, which were between $4,800 and $12,800. According to the TGA, there are no fees for a licence and permit to import medicinal cannabis. Mr Turland says setting up a medicinal cannabis growing facility can take anywhere between two and four years. ( ABC News: Maren Preuss ) Speaking as part of the new alliance, Mr Turland said it was unfair that countries such as Canada — which is Australia's biggest importer — can import to Australia, but those countries did not allow imports in return. "Because they have an oversupply and we have an under supply … what we find is that we don't even have access to these same markets," Mr Turland said. " There's no reciprocal trade at all. " Photo shows People in lab coats and hair nets stand in the doorway of a room full of cannabis plants under lights. Laws around cannabis use are changing in countries like France and Germany, and Australian farmers are hoping to make millions. Mr Turland said domestic producers outsourcing production overseas meant Australia was missing out on an estimated 5,500 jobs. The TGA said there were 29 cultivation and production permits and 10 manufacture permits for medicinal cannabis in Australia. Mr Turland said that could meet local demand but "imports are constantly stifling that growth for domestic producers". "This … flood of imports is ultimately squashing the ability for domestic producers to meet domestic demand," he said. The TGA said the Office of Drug Control (ODC) published the amount of approved domestic cultivation on its website. "As demand for medicinal cannabis continues to grow in Australia, the ODC is not able to comment on future supply needs and commercial decisions of licence holders to grow product." Mr Turland wants to see a domestic-first policy which would allow Australian growers to fill the supply amount permitted by the government, before handing importers any portion leftover — as happens with other industries. " So the Australian producers produce, let's say it's 50 tonnes, and if there's a 20-tonne gap, that's given to importers. " The TGA said the decision on whether to enforce an Australian-first policy was not a decision for the ODC. To outsource, or not to outsource jobs Craig Knight's business, Tasmanian Botanics, grows and manufactures cannabis into products on site. Mr Knight said that meant imported cannabis products "doesn't really affect us too much". "We're … set to compete," he said. Craig Knight's business grows and manufactures medicinal cannabis products. ( ABC News: Maren Preuss ) But Mr Knight acknowledged the current climate was challenging for others. " A product that might have got you six dollars a gram now might only get you three dollars a gram because the imports are coming in … so that would be challenging. " Photo shows Medicinal cannabis plantations across open field outside with hills in the distance. The amount of money Australians are spending on medicinal cannabis continues to skyrocket, with new data showing this year's sales are on track to double those from 2023. Greens Senator Peter Whish-Wilson — who uses medicinal cannabis to treat chronic pain — said the current system "alarmed" him, and that he'd be raising the issue in parliament. "I support the most rigorous standards possible to make sure that the medicine that we use is appropriate, that it's been checked, and that it goes through the appropriate checks and balances." Senator Whish-Wilson said he feared local growers would not immediately be able to make the move to manufacturing medicinal cannabis products. "They're saying that they've got their backs to the wall and they're going to [be impacted] if governments don't listen to their concerns," he said. The TGA said there were only two medicinal cannabis products approved on the Australian Register of Therapeutic Goods (ARTG) — Sativex (nabiximols) which is used to treat certain patients with multiple sclerosis and Epidyolex (cannabidiol) which is used for patients with certain seizure disorders. "However, most medicinal cannabis products accessed in Australia are not on the ARTG and are referred to as 'unapproved' therapeutic goods," the agency said. It said unapproved products were not assessed by the TGA for quality, safety or efficacy, and could only be accessed via the Special Access Scheme, the Authorised Prescriber Scheme and clinical trials.
ABC News
23-04-2025
- Business
- ABC News
Recycle Rewards, Tasmanian container deposit scheme, to result in higher prices
A long-awaited Tasmanian container deposit scheme that promotes recycling will leave beverage retailers "no choice" but to pass on the cost to consumers, an industry representative says. Recycle Rewards begins on May 1 and will enable Tasmanians to redeem 10 cents per bottle or can brought to a recycling collection point, which residents can redeem in cash, or nominate to a charity or sporting club. According to the scheme operator TasRecycle, beverage companies will be charged an extra 21.43 cents (including GST) for each aluminium can they supply into the state, and a similar rate for other eligible containers. Material type Cost per container supplied (ex GST) Cost per container supplied (inc GST) Aluminium 19.48 cents 21.43 cents Glass 20.17 cents 22.19 cents HDPE 19.62 cents 21.58 cents PET 19.78 cents 21.76 cents Liquid paper board 20.88 cents 22.96 cents Steel 19.53 cents 21.48 cents Other plastics 19.53 cents 21.48 cents Other materials 19.53 cents 21.48 cents Weighted average cost 19.80 cents 21.78 cents Source: Supermarket giant Woolworths announced that as of May 1, an extra 22 cents will be added to the cost of every drink product affected by the scheme in Tasmania. 'Significant impact' for drink companies A poster at Woolworths explaining price increases on products that will come in with the state's recycling scheme. ( ABC News: Scout Wallen ) Andrew Quarry from Australian Liquor Marketers in Tasmania, said the scheme will be the biggest challenge the local liquor industry has faced in 25 years. "Breweries are now budgeting on a 10-per-cent decline in beer carton sales, so it is going to have a significant impact," he said. TasRecycle chair Ben Kearney said the cost to suppliers covered the operating costs, and was put in place to ensure the scheme was accessible to all Tasmanians. "The operating costs include TasRecycle managing the viability of the scheme and reduction of fraud, and TOMRA Cleanaway managing operations of the scheme, including logistics and processing across the state," Mr Kearney said. "Over 45 per cent of all litter volume in Tasmania is made up of drink containers and all Tasmanians can help reduce waste and increase recycling rates by participating in Recycle Rewards." He said beverage suppliers pay the cost of the program. " Independent reviews in other states have found no evidence of unjustified increases in the drink price during the first year of implementation of container refund schemes. " Comsumers and retailers will have to bear the extra costs placed on products covered by the recycling scheme. ( ABC News: Ebony ten Broeke ) How will it work? Mr Quarry said drink companies will be charged up to 21.43 cents extra, including GST, to supply their products into Tasmania — with that cost then passed onto the retailers. Photo shows A row of beer cans on a conveyor belt It has a name, a logo, and even a nifty YouTube video explaining how it works. "For example, with 24 packs [of beer] it's about an extra $5 to $5.20. In a 30-pack of beer, it's about $6 to $6.40." He said the retailers with will have "no choice" but to pass that extra cost onto their customers. "That cost increase is so significant that at no point could we expect anyone to absorb that cost." Mr Quarry said it is going to be confusing for shoppers, because if they purchase a 30-can carton which has accrued an extra $6, they will only be able to redeem $3, at 10 cents per item. " The concern we have is that our retailers are going to be exposed to a pretty challenging conversation with consumers. " Independent retailer worried Ankit Bali owns and manages an independent liquor store in Hobart, and wants to protect his customers from the extra costs. "My aim is to not increase our prices any more than we have to, but unfortunately we also have to look at our increasing costs which means wearing the burden," he said. One bottle shop owner says he will probably have no choice but to pass on the extra costs to customers. ( ABC News: Ebony ten Broeke ) For his small business, Mr Bali said he might order 20 cartons a week, which will see the cost increases stack up. "All of a sudden, it's about $120 of additional cost that we kind of have to fork out without trying to increase our prices," he said. " I don't think it's very fair, especially in the economic situation that we're in at the moment. " Tasmania's long-awaited container deposit scheme will come into effect on May 1. ( ABC News: Ebony ten Broeke ) Mr Bali said he would like to know how the government landed on the set price, seeing as customers are only getting 10 cents in return. "So effectively, you're looking to make a 100-per-cent profit on everyone returning a can," he said. "The fact that they're turning this [environmentally] positive scheme into something to generate revenue for themselves makes it really confusing, but then also hurts me." He said there hasn't been adequate information about the scheme and its impact on retailers. " It's a very confusing thing and I would really appreciate more information … on how such a small business like ourselves is going to target this. " The extra cost placed on suppliers to Tasmania will be the highest in the nation. ( ABC News: Cason Ho ) Geographical challenges The cost of the scheme for companies supplying to Tasmania is one of the highest in the country. For example, an aluminium can excluding GST will cost suppliers 19.4 cents in Tasmania, but in Queensland the price is 12.8 cents, NSW is 14 cents, Victoria is 14.5 cents, and WA is 12.3 cents. Minister for the Environment Madeleine Ogilvie said Tasmania's "unique" geography had created challenges and additional costs. "Namely, a smaller container volume and population size, the transport of containers across Bass Strait and our lack of access to the economies of scale enjoyed by mainland states," she said. Cost changes ahead, supermarket giants say In a statement, a Woolworths spokesperson said the retailer had been "working through the implementation" of the scheme "with our supply partners". "As in all other states, where there are retail price changes resulting from the costs associated with a container deposit scheme, we have communicated these changes to customers in-store. "We're supportive of the container deposit scheme based on successful implementation in other states and the positive environmental, litter reduction and recycling outcomes." The container scheme has been years in the making. ( ABC News: Ebony ten Broeke ) A spokesperson from Coles supermarkets said the retailer was "helping to make recycling drink containers more convenient for our customers by rolling out four Reverse Vending Machines at Coles stores" as part of the scheme. "Our customers will be rewarded for returning their used cans, bottles and cartons, with the option to convert the funds into a Coles voucher, redeem for cash, donate to a charity or transfer directly into a nominated bank account. " As a result of this recycling initiative customers may notice an increase on beverages eligible to participate in the scheme. This additional cost covers the 10c container deposit that customers can redeem back, and contributes to the running and administration of the scheme. "
