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Chiang Mai Citylife > Articles > Thailand’s Budding Cannabis Future

Thailand’s Budding Cannabis Future

After living in Thailand for two and a half years, I’ve experienced first-hand the hush-hush surrounding what the locals call ganja. And why shouldn’t they be whispering about this oddly popular plant? Historically speaking, users, producers and distributors of cannabis have been subjected to severe punishments.

Coming from the United States, a nation in which the majority of states have legalised some form of cannabis, the stigma surrounding the plant in this country left my mouth ajar and my eyebrows raised. So I was taken completely by surprise when I read that Thailand had legalised medical marijuana earlier this year, becoming the first Asian country – even before the United States – to federally legalise the previously highly illicit medicine. This, paired with Thailand’s strange love-hate history with cannabis, drove me to delve into the progression of the cannabis industry in Thailand.

Culturally speaking, cannabis has been used throughout Southeast Asia as an ingredient or condiment in foods, medicine, and even a source of fibre for clothing for centuries. Traditional Thai medicine and Thai massage practitioners have long been known to treat a plethora of health conditions with the herb. Cannabis plant (hemp) fibres have also been used throughout Thai history to create useful products, including rope and clothing while early Muay Thai fighters commonly used hemp hand wraps with seashell-shaped knobs during fights, right up until the 1920s.

So at what point did Thailand decide to crack down on this ubiquitous plant?

For that I had to look back at my home country. During the 1960s, the United States installed military bases throughout Thailand, stationing tens of thousands of U.S. soldiers in the kingdom. Naturally, the soldiers were introduced to locally grown cannabis, giving it the nickname ‘Thai Sticks’ because of how the locals tied the buds to thin bamboo sticks. The easy sales would drive locals to increase production to meet the demand, and eventually, that demand would spread far beyond the borders of the Kingdom of Thailand.

Naturally, such an inexpensive way to unwind and de-stress would birth a Thai-to-U.S. black market boasting impressive profits for locals and smugglers alike. Before soldiers began exporting Thai Sticks to the U.S., cannabis lacked any sort of legal or moral stigma. However, the U.S.’s ongoing ‘War on Drugs’ would push Thai legislators into implementing severe penalties for the consumption, production, sale, and smuggling of cannabis in the Kingdom of Thailand.

By the 1980s, the U.S. government had convinced Thailand to act as its ally in the fight against marijuana, which meant that the Land of Smiles has been the land of prohibited cannabis for decades, even as the majority of the U.S. and many other nations have been conducting research and developing legal markets for medical and recreational production and distribution of cannabis products.

Medical cannabis is now legal in Thailand. However, it isn’t accessible. And recreational cannabis is still prohibited. Even with this being the case, there is an ever-growing group of people who are publically pushing for the progression of the cannabis industry.

I met with Kitty Chopaka, the founder of Elevated Estate, a start-up incubator and accelerator for innovative cannabis products and services, to learn more about her vision, what’s currently happening with the industry and what we can expect to see in the future.

“Just having people talking about cannabis at their dining table openly, with their family, is the biggest goal,” Kitty said. “Normalisation is the only way. We need to de-stigmatise before even looking at anything else.”

Kitty says Elevated Estate is also focusing on building an environment to establish a cannabis industry in Thailand. Small start-ups will face many challenges in participating in this future industry and she’s working to bring everyone together to participate in what she hopes will become a foundation for the future growth of the industry.

“If I don’t try to come out and influence or start this whole ecosystem of the business side, there won’t be any suppliers, there won’t be any competition, and there won’t be an actual market.”

On 18th November 2019, Kitty and Elevated Estate will be holding the Elevating Cannabis Expo 2019: Asia’s Green Rush, in Bangkok. This will be the largest annual international Cannabis Conference in Asia. The event will feature a market snapshot, in-depth education regarding what’s happening and what opportunities are out there, local and international industry connections, thought leaders in the industry, and the 1st Asian Jack Herer Cup Award Ceremony after party.

Getting back to the current state of the industry, one concern is that the industry will be closed off to the public. Kitty went on to explain, “There are rules and whatnot, yes – especially in terms of cultivation. It’s almost impossible for the general public to get involved. But that cultivation is a very small percentage of what the market actually is.”

In terms of recreational use, Kitty believes adding cannabis to products currently being used will become the norm. Because of the cost, Thailand will struggle to compete with China, India, Australia, and the Philippines for a share of the cultivation market.

Kitty believes that Thailand is in a unique position to add value. “We will see crude oil imports, enabling Thais to add the cannabinoids (cannabis compounds) to current production lines, immensely increasing the value of these local products in the process. For example, CBD-infused massage oils, balms, etc.”

Kitty went on to discuss how Elevated Estate wants Thailand to become the central hub for the region’s cannabis market. Her group is pushing to ensure that anything relating to trade or business in the cannabis industry – from Australia to China – will happen in and go through Thailand.

“The sale is going to be here, the buyer is going to be here,” her enthusiasm unwavering. “We are in the epicentre of the vortex that’s about to blow up.”

“This is the very beginning. Right now, we’re putting the cannabis seeds into the tissue,” highlighting these cumulative efforts as the spark that will inevitably ignite Thailand’s green rush. “We’re trying to germinate. We haven’t even put the seeds in the soil yet.”

The regulation aspect is a concern: too much will result in a thriving black market and too little will result in illegal imports from neighbouring countries. Kitty discussed Thailand’s dangerous sourcing black market cannabis as well, highlighting cannabis prohibition’s role as the culprit in fuelling unsafe production practices.

“About 90% of our cannabis comes from Laos. Those are the brick weeds grown outside. I spoke with the ONCB (Office of the Narcotics Control Board), and they said pesticide wasn’t just used; it was literally bathed in pesticides. We have arsenic, all the heavy metals, as well as mosquito coils. And they don’t dry properly. There is no such thing as curing. The reason [the colour] is black is because that’s the conversion of THCA into the CBN, and that’s actually a mild psychedelic that will make you a lot sleepier. The other 10% of the market is usually from small local cultivators. It’s not like we’re lacking experienced growers, it’s just that it’s illegal.”

The severe punishments associated with cannabis also play a role in slowing the progression of the legal industry. Testing positive for THC can result in up to 1 year in prison and a fine as high as 20,000 baht. That’s not even for possession. Possession of product involves an additional possession charge, and if you’re growing, that’s an even more severe production charge.

During our conversation, she touched upon how the government will have to take a closer look at the evolution of cannabis, highlighting that Thailand is attempting to legalise, yet everyone is still stuck on the flower as opposed to how the industry will evolve.

Innovation is bound to occur, but it will take time. A cannabis industry report for Thailand will be released in February. But even though we have a long way to go before ganjapreneurs can begin seeking financial backing, some funding has been raised.

Expara Thailand, a VC fund management company, is partnering with Elevated Estate to assist in establishing the cannabis industry in Thailand. So far, they’ve raised USD $30 million, with this funding designated explicitly for investing in innovative cannabis start-ups in the kingdom. This should come as no surprise when considering the potential market value by 2024 is USD $661 million. according to ProhibitionPartners.com.

Potential ganjapreneurs will have to write business plans highlighting truly innovative additions to the cannabis industry to gain access to this funding. However, without a report of industry numbers, writing an accurate business plan is impossible. So for now, they’re wantrepreneurs waiting on February’s numbers.

As stated earlier, medical cannabis is legal. But with just four ailments permitting consumption, it’s hard to get a prescription. And even if you do get your prescription, purchasing medical cannabis is so difficult its borderline impossible.

Thailand currently has 300,000-500,000 people who qualify for medical cannabis. These are the patients with epilepsy, cancer patients going through chemotherapy, people who have chronic nerve pain, and muscular sclerosis (MS). Once the kingdom shifts to accept internationally recognised ailments treatable with medical cannabis, the number of people qualifying should skyrocket to around 1.5 million people.

Then we have the aging population to consider. The demand is here, but it can’t be fulfilled legally until Thailand establishes a market and puts regulatory practices in place.

For foreigners coming to visit or live in the kingdom of Thailand, the law already allows patients to bring their cannabis. You’ll have to declare it, but you can bring around 90 days’ worth of supply. The problem is the system for this law is not out yet. So I wouldn’t suggest BYOH (bringing your own herb) just yet.

It’s possible to get a doctor’s prescription to consume cannabis in Thailand, but the product isn’t accessible enough. You must go to one of 13 hospitals with cannabis clinics. But since there are only three licensed producers and just two currently producing cannabis, the supply is shockingly limited. Just seven licenses are out — three are licensed producers for medically prescribed cannabis while four are solely producing for research purposes. Cannabis clinics are only open for one day out of the month due to this shortage.

If you’re growing cannabis for medical purposes, the idea is that you should be allowed to get a license to grow. However, for the first five years, the grow licenses are limited to hospitals, university or government departments, or a joint venture of the private sector combined with any of those three.

Thus, we’re seeing a 5-year limitation on the private sector entering the market. Once the private sector emerges, it should take another few years until the government begins looking at the options for recreational legalisation, Kitty believing that this should happen within eight to ten years.

The private sector is already pushing to become a part of the cannabis industry, even at this early stage. While many choose to focus on the cultivation of the plant, others see the path for their own success in the innovations surrounding this industry.

I met with Thomas Ruiter, owner of Take Me Home Tomatoes, to discuss how businesses are positioning themselves for their piece of the cannabis pie.

Thomas’s company arrived in Thailand 15 years ago to set up the greenhouse industry. Through strategic planning and implementation, he and his team successfully established the industry, incorporating agricultural technology and teaching farmers how to use it to grow superior produce — specifically, tomatoes.

Due to seasonal gaps and land being quite expensive, agricultural investments are relatively high. Thomas’s company is innovative in the way it focuses on maximising yields per square metre, developing a greenhouse concept specifically designed for the tropical Thai climate.

“Our interest is not so much from a growing perspective or getting a license, but more from the technology side of the whole industry.”

Humidity, high temperatures, intense sunlight, and short days characterise Thailand’s natural environment. These inhospitable growing conditions demand adjustments to allow non-native plants to thrive.

The company had been developing this tech for the horticulture industry — mainly for flowers and food production. Now they’re focusing on revising the tech to facilitate the growth of medical-grade cannabis.

Thomas’s tropical growing concept offers passive/active climate control. These features will make growing medical-grade cannabis more affordable as the tech enables growers to create and actively adjust a microenvironment that’s more suitable for the plants.

According to Thomas, the private sector is expressing the most interest in growing cannabis at the moment. Some institutions and universities have reached out. However, it’s mainly private companies in conjunction with government agencies contacting him about his tech.

Private companies cannot independently apply for a license. As previously stated, legal grow operations still have to be connected to a government or institution. Even with this being the case, private companies are funding these operations.

“They [the government and institutions] don’t have access to the funds, and they don’t have access to the technology,” he explained. “The private sector is initiating everything, and they just need help from an institution to get a hold of a license.”

As the cannabis industry continues its progress in Thailand, many aspects remain unknown. However, as the industry matures from the germination stage into the seedling, vegetative, and flowering stages before harvest, there are two things we know for sure: The people educating the kingdom on safety, consumption, agriculture, and technology are the nutrients encouraging those fantastically sticky buds to form – and when recreational cannabis finally gets legalised, Thailand will have yet another reason to be known as the Land of Smiles.