Marijuana and hemp will be removed from the Category 5 narcotics list, starting tomorrow, according to the Thai Food and Drug Administration.

To operate a legal marijuana-related business in the country, growers can simply register through the Pluk Kan mobile app.

The legal change, which makes Thailand the first country in Southeast Asia to decriminalise the drug, has caught the eye of businesses, which see it as an opportunity.

Charoen Pokphand Foods (CPF), the food and beverage arm of Thailand’s largest conglomerate, CP Group, formed a joint venture with renewable energy developer Gunkul Engineering to produce cannabidiol (CBD)-infused food and beverage products.

The venture will invest in hemp cultivation and extract CBD as an additive to food and drinks.

The products are expected to be sold through CPF’s retail channels.

“CPF takes an interest in hemp as a new economic crop that can be turned to value-added food and beverages in light of growing demand, both domestically and internationally,” said Prasit Boondoungprasert, the company’s CEO.

He added that the collaboration with Gunkul will lead to both upstream growing of marijuana and midstream and downstream development of products.

Saha Pathana Inter-Holding, a subsidiary of consumer products giant Saha Group, will jointly invest 370 million baht with United Power of Asia and Golden Triangle Group to cultivate marijuana in the northern city of Chiangrai.

The companies look to extract the plant’s essence and sell to clients making medicines, foods and beverages.

The market value of marijuana-related business is estimated at 40 billion baht and is expected to grow to 70 billion baht by 2024, according to the Thai Industrial Hemp Trade Association.

The Global Cannabis Report, a trade publication, says the legal marijuana market is currently worth US$100 billion worldwide.

Thailand took its first step toward decriminalising marijuana in 2019, when the government allowed it to be grown and used for medical purposes.

Last year it approved its use as an additive to food and drinks.

This encouraged food processors and restaurants to add hemp and marijuana to everything from famous Thai dishes to bread, cookies and pizza.

The Bhumjaithai Party, the second largest party in Thailand’s ruling coalition, played a key role in decriminalising the plant.

The party’s leader, Anutin Charnvirakul, campaigned on the issue through the 2019 general election.

The party won 51 seats in the lower house, giving it a strong say in the coalition as it helped junta leader Prayuth Chan-ocha to remain in power as the elected prime minister.

Anutin was named public health minister shortly after the election.

Although he was heavily criticised for a botched early response to the Covid-19 pandemic, he remained in office, pushing for marijuana legalisation.

In 2021, kratom, a less potent psychoactive plant native to Southeast Asia was legalised first to assess its social impact.

Until tomorrow, possession of marijuana in Thailand is punishable by a prison sentence of up to 15 years.

The legal change scraps that penalty.

According to the department of corrections, more than 4,000 inmates charged with violating the law or serving criminal sentences for marijuana-related violations will be freed, starting tomorrow.

Thailand is not alone in relaxing marijuana laws.

Canada legalieed recreational use of the drug in 2018.

Uruguay made it legal for medical and recreational use since 2013.

Many other countries have moved toward decriminalisation, as marijuana gains acceptance as a cash crop for poor farmers.

In Thailand, the ministry of agriculture plans to distribute 1 million marijuana plants to farmers in remote areas free of charge to get them to start growing what it hopes will be a lucrative crop.

Decriminalisation, however, leaves marijuana consumption in a legal grey area.

Home use of the plant is allowed for health and medical purposes, but there is no organic law to control other uses.

Extracts containing more than 0.2% of cannabis’ main psychoactive compound tetrahydrocannabinol, or THC, are still recognised as a Category 5 narcotic.

Apart from conglomerates, Sri Trang Agro Industry, Thailand’s biggest rubber grower and exporter, has invested 26 billion baht in marijuana and hemp cultivation.

The company plans to grow the plants on 32 hectares, producing CBD for medical and functional foods.

Eternal Energy, a leading renewable power developer, has invested 680 million baht in marijuana cultivation for CBD, which will be sold to clients that were contracted in advance.

Most clients use CBD for medical products, while some use it as a cosmetics ingredient.

“We have earmarked more investment money for plantation expansion, as we realised that demand is rising globally,” said Eternal Energy’s CEO, Worasak Kriangkomol.

Small and medium-size businesses like 88Cannatek are also active in the new market.

The company has invested 177 million baht to grow marijuana for CBD as an additive to functional foods and cosmetics.

“Of the total investment, around 115 million baht was from crowd funding,” Pornprasith Sibunruang, the company’s founder and CEO, told Nikkei Asia.

He said his company has partnered with leading hemp and cannabis growers in the US since 2019 to learn marijuana growing and extraction techniques.

The company has a plantation in the northern city of Chiangrai and has partnered with contracted farms in several areas in central Thailand.

The company produces around 250kg to 400kg of CBD annually and aims to increase that to 3,000kg over the next few years.