Costa Rica Finalizes Licensing for Hemp Cultivation and Production: What This Means for the Industry

After two years of planning and development, Costa Rica has officially opened its doors to hemp cultivation and production. On September 3rd, Costa Rica’s Ministry of Agriculture and Livestock (MAG) issued 57 licenses, allowing companies to start producing hemp-based products. This milestone represents significant progress in the Central American nation’s journey toward a legal hemp and cannabis industry, initiated in March 2022 when Costa Rica legalized hemp and medical marijuana.

The new licenses, which are valid for six years, mainly went to businesses in the capital city, San Jose, and the province of Guanacaste. Among the early licensees was Ingenio Taboga, which received the country’s first business license in November 2022, and the National University of Costa Rica, which obtained a research license in August 2023.

This methodical pace reflects the government’s focus on establishing a stable framework for hemp. Roy Thompson of the Hemp and Cannabis Council of Costa Rica explained, “We have to walk before we run.” He highlighted the importance of building robust testing and processing facilities, which will be critical as new businesses seek to enter the market and adhere to quality and safety standards.

Currently, hemp production in Costa Rica is limited, focusing on CBD oil extraction for medicinal uses. MAG guidelines specify that hemp products may contain up to 1.0% THC, but they recommend keeping CBD levels below 0.03% to prevent any psychoactive effects. Medical marijuana licensing has also begun, with the first license granted in May 2023 to Azul Wellness S.A., marking another step toward a regulated cannabis industry.

For Costa Rica, these developments bring the potential for both economic and medical benefits. The country is poised to become a significant player in Latin America’s growing cannabis market, but the journey is just beginning. By balancing regulation with industry growth, Costa Rica aims to nurture a sustainable and responsible hemp sector that can benefit the economy and public health alike.