Twenty-five companies have applied for licences to grow and manufacture medicinal cannabis in Australia. 

Federal Health Minister Greg Hunt announced today medical marijuana could be easier to import to Australia, if requested through a doctor, by fast-tracking importation while local supplies expand.

Meanwhile the Victoria Government has harvested its first crop and approved a trial to test its effectiveness of cannabis a treatment for epilepsy.

Medical marijuana is already a rapidly growing business in Israel, the United States and Canada and many of those global companies are now positioning themselves for entry here.

What are the opportunities for Australian agriculture?

The domestic market for medicinal cannabis is worth an estimated $100m/year and with raw material difficult and expensive to import there is plenty of interest.

The problem for small scale farmers is that medicinal cannabis probably will not be grown as a broad acre crop like poppies. 

For security and production reasons most companies are applying to grow in glasshouses.

WA firm AusCann re-listed on the stock market earlier this month and raised a rapid $5million to finance their growing plans.

The company is part-owned by Canadian giant Canpopy Growth Corporation, the world's biggest producer of medicinal cannabis.

AusCann CEO Elaine Darby said that relationship provided it with genetics and pharmaceutical knowledge but now it had to wait for Federal Government licence approval before proceeding.

"They have the fit and proper person test … not only your board of directors, all of your employees, anyone you associate with all have to have full police clearance."

AusCann has contracted a security firm to do a security assessment required for all manufacturing and cultivation operations to reduce the risk of medicinal cannabis being diverted to the black market. 

Ms Darby said they planned to use glasshouses with retractable roofs partly for security but also to maximise the growing conditions.

"If you grow this plant in Australia outdoors you only get one crop, but if you can artificially light you can get three, maybe four crops a year out of them."

She said the company was looking at a site "not too far out of Perth".

Manufacturing medicinal cannabis

Whatever is grown in Australia will have to be processed and packaged as medicine.

A small pharmaceutical company based in Melbourne is involved in preparing medicinal cannabis for two medical trials under way in NSW.

For security reasons they cannot be identified but the chief executive said there was a lot of interest in growing cannabis in Australia because importing it is difficult.

"There are issues around importation and the speed with which these materials can be brought in because you need import permits both into Australia but also the shipping country also needs an export permit.

"These can take anywhere between 30-60 days so it makes it difficult to transport these products between countries."

He said there were are opportunities for seed companies to develop seed stocks and for companies involved in extracting oil as that is used in the production of pharmaceutical products.

He said there were two approaches people were taking with production.

"There is the super critical extraction with CO2 extractors which tend to produce a consistent product and don't have the issue of high solvent volumes. 

"The other more traditional [method] is ethanol extraction or solvent extraction and this really comes down to the volume of material you are handling.

"CO2 has a lot of up-front costs cause the equipment is expensive while ethanol has some issues around handling and volumes but equipment wise has a lower set up cost."

Victoria issues trial licence

The head of the Victorian company granted the first Australian cannabis research licence said medical marijuana had the potential to be a significant industry in the state.

The licence was granted to Melbourne-based company Cann Group after the first successful harvest of a Victorian Department of Economic Development, Jobs, Transport and Resources cannabis crop.

Cann Group chairman Allan McCallum is a former GrainCorp director.

Mr McCallum said his company had a licence to research the medicinal qualities of the plant to optimise the levels of cannabinoids, improve growing conditions or undertake pre-clinical research in animals and would now need to apply for a permit for cultivation.

He said the company expected to be able to start growing the crop within two to four weeks if it was granted.

"We'd probably be six to 12 months away from commercial production," he said.

He said trials with a low-THC cannabis variety had been successful.

"We think we've got our growing techniques down pat," he said.

"Keeping mind this is all hydroponic and indoors and in pretty secure facilities."