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The Phakisa is the Light at the End of the Tunnel says Labat’s Van Rooyen

The Phakisa is the Light at the End of the Tunnel says Labat’s Van Rooyen

Labat Africa CEO Brian van Rooyen says The Phakisa has created a new momentum in the South African cannabis industry, and the JSE-listed company is well-positioned to take advantage of this. He says that, to date, playing in the cannabis sector has been an uphill battle, but the Presidential initiative shows there’s hope on the horizon.

Cannabiz Africa

11 August 2023 at 13:30:00

Labat Africa CEO Brian van Rooyen has weathered a few storms in his time as he’s tried to pull the JSE-listed company across the first mover advantage line. He told BusinessDay TV on 28 July 2023 that the Phakisa Hemp and Cannabis Action Lab initiative showed the Presidency was serious about speeding up the creation of a commercial framework for trade in cannabis and related products.

“In our view that’s accelerated the whole cannabis industry in South Africa; to ensure that we reap the benefits of this wonderful plant out in Africa that everybody is looking for throughout the world” said van Rooyen.

“And yes, there is light at the end of the tunnel as it has been an uphill battle, particularly on the regulatory side”.

He said cannabis was still classified as a narcotic under the Drugs Act and a Schedule 6 substance under the Medicines Act and that despite the Constitutional Court ruling legalizing the private consumption of cannabis “it still becomes a major issue for those who have invested a lot of money in the cannabis industry.”

“What we’ve seen in the last couple of years is that if you have not been able to be involved in the entire value chain of cannabis, it becomes very difficult” he said, pointing out that the 100 or so licenses that have been issued by SAHPRA, were only for the export of medicinal cannabis. Van Rooyen said the SAHPRA licenses did not guarantee entry into Europe as am additional EU GMP certificate was also required.

“So, it makes it very difficult, but it puts Labat in a much better position because Labat has received from the regulator an extraction license, which means we don’t have to export flower any more, we can extract the oils and then work with the oils, formulations, and thus the acquisition of the 30% of CannAfrica that we didn’t own. Labat now owns 100% of CannAfrica”.

When asked if there was a demand for South African cannabis in the international market, van Rooyen replied: “No doubt about it. If you just look at the DTI’s estimate of the illicit market it accounts for R28 billion per annum, and that’s just in South Africa. The various reports that we’ve seen indicate the cannabis industry world-wide by 2024 be close on US$50 billion, so it is huge, given the fact that the American government has not yet opened cannabis from a federal point of view, which means you can trade in cannabis only intra-state in some states, but you are not allowed to import or export cannabis product whether it is for adult use or for medicinal use. 

"So the market is huge and the advantage for South African companies, and is that boy, we’re growing it, whether it’s snowing or whether there are tornadoes in Durban, we are growing it in sunshine. 

"We don’t have to go into expensive growing facilities under lights and all that, and that has been the problem with some of the growers who’ve been awarded licenses by SAHPRA.”


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