Research:2026-06-28/Journal article/value-capture-in-the-emerging-medical-cannabis-global-value-chain-insights-from-south-africa

Research record28 June 2026Journal article

Value capture in the emerging medical cannabis global value chain: insights from South Africa

Andrew Bowman

International Journal of Drug Policy · 2026

Abstract

Background A global value chain (GVC)-an international network linking producers and consumers through multiple intermediaries-has rapidly emerged in recent years to connect geographically dispersed cultivators and consumers of legal medical cannabis. This is commonly presented as an important new economic development opportunity for low- and middle-income countries with favourable agro-ecological conditions. This paper analyses the growth of the legal medical cannabis GVC in South Africa, a major emerging supplier, focusing on how chain governance and power relations shape processes of inclusion, exclusion, and value capture. Methods The paper draws on 34 semi-structured interviews conducted between 2021 and 2024 with a range of stakeholders in the medical cannabis GVC, including cultivators, brokers, consultants, and civil society. Interviews were analysed using Nvivo with a hybrid coding strategy. Results Interviews reveal that cultivators face intersecting challenges: regulatory complexity, increasingly intense competition, bargaining power imbalances, and a demanding series of quality conventions in which the sensory and aesthetic qualities of an artisanal product must be combined with pharmaceutical rigour. Barriers to entry are high, and costly upgrading processes are necessary to avoid falling into a commoditisation trap as easily-replaceable suppliers of a generic good, subject to 'race to the bottom' competition and price volatility. Conclusions These challenges undermine aspirations for medical cannabis exports to serve as an inclusive economic development opportunity for small-scale cultivators in the Global South. GVC participation requires major capital expenditures and advanced capabilities. Overcoming these challenges would require significant policy support.

The paper's abstract, reproduced as published.

DOI

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Record created 8 August 2026 · maintained by landrace.wiki editors · page history

Published28 Jun 2026

TypeJournal article

VenueInternational Journal of Drug Policy

Year2026

DOI10.1016/j.drugpo.2026.105400

CountrySouth Africa

DOI

2026-06-28 2026-08-08 Value capture in the emerging medical cannabis global value chain: insights from South Africa Journal article Policy and law Andrew Bowman International Journal of Drug Policy 2026 10.1016/j.drugpo.2026.105400 https://doi.org/10.1016/j.drugpo.2026.105400 Analyses the legal medical Cannabis global value chain in South Africa through 34 semi-structured interviews conducted between 2021 and 2024 with cultivators, brokers, consultants and civil society. Cultivators reported regulatory complexity, intensifying competition, imbalances in bargaining power and quality conventions requiring both artisanal sensory character and pharmaceutical rigour. The author argues that barriers to entry and the capital cost of upgrading push suppliers towards commoditisation and price volatility. The conclusion is that medical Cannabis export is unlikely to serve as inclusive development for small-scale growers in the Global South without substantial policy support. Background A global value chain (GVC)-an international network linking producers and consumers through multiple intermediaries-has rapidly emerged in recent years to connect geographically dispersed cultivators and consumers of legal medical cannabis. This is commonly presented as an important new economic development opportunity for low- and middle-income countries with favourable agro-ecological conditions. This paper analyses the growth of the legal medical cannabis GVC in South Africa, a major emerging supplier, focusing on how chain governance and power relations shape processes of inclusion, exclusion, and value capture. Methods The paper draws on 34 semi-structured interviews conducted between 2021 and 2024 with a range of stakeholders in the medical cannabis GVC, including cultivators, brokers, consultants, and civil society. Interviews were analysed using Nvivo with a hybrid coding strategy. Results Interviews reveal that cultivators face intersecting challenges: regulatory complexity, increasingly intense competition, bargaining power imbalances, and a demanding series of quality conventions in which the sensory and aesthetic qualities of an artisanal product must be combined with pharmaceutical rigour. Barriers to entry are high, and costly upgrading processes are necessary to avoid falling into a commoditisation trap as easily-replaceable suppliers of a generic good, subject to 'race to the bottom' competition and price volatility. Conclusions These challenges undermine aspirations for medical cannabis exports to serve as an inclusive economic development opportunity for small-scale cultivators in the Global South. GVC participation requires major capital expenditures and advanced capabilities. Overcoming these challenges would require significant policy support. South Africa