A recent scan of ecosystem actors across Oceania shows that the industrial hemp industry is gathering real momentum in both Australia and New Zealand, mirroring trends around the world where hemp is re-emerging as a cornerstone of sustainable and circular economies. Businesses are emerging across the value chain, backed by growing interest and support from governments, researchers, communities, and not-for-profits. Globally, these efforts are connected by an urgent search for sustainable, circular alternatives in construction, agriculture, textiles, and more.

Industrial hemp is far more than just another crop. Cultivated for thousands of years and once prized for rope, sails, textiles, and paper, it is now re-emerging as a powerful systems-level leverage point. By reducing embodied carbon and, in applications such as hemp construction materials, sequestering CO₂ for the lifetime of a building, hemp contributes directly to net-zero goals. Beyond construction, it supports regenerative agriculture, generates regional jobs, enhances health and wellbeing, and enables sustainable bio composites to replace fibreglass, plastics, and other carbon-intensive materials across industries from transport to manufacturing.

Yet, like many emerging industries, hemp faces the familiar “chicken-and-egg” challenge: underdeveloped supply chains limit market confidence, while uncertain markets constrain investment in reliable supply. It also contends with vested and incumbent interests, and entrenched “business as usual” approaches, which can resist or slow the industry’s development and potential.

“What we need most is collaboration. We’re not in competition with each other — our  real competitors and barriers are the vested interests that don’t want to see  the shift toward hemp products.”

(Bob Doyle, Director, Hemp Inside, NSW)

Addressing these barriers requires the right policy settings, shifts in culture and practice across production, processing, and end use, and a strong commitment to innovation and R&D to close knowledge gaps. Above all, it calls for authentic collaboration across the ecosystem.

Emerging  Hemp Hubs and Clusters

Across Australia and New Zealand, place-based hemp hubs and clusters of activity are taking shape as focal points of energy and experimentation.

• Vertically integrated models are emerging, seeking to align and unlock the potential of the full value chain under one umbrella. Their embeddedness in place and commitment to both environmental and economic outcomes stand out.
• Margaret River Hemp Co - one of the earliest pioneers in Australia’s modern industrial hemp sector - remains one of Australia’s most established hemp businesses, with many newer entrants on the rise.
• Wandarra (Far North QLD) is progressing significant capital raising to bring an ambitious vertically integrated hemp processing hub to scale, as part of co-processing locally produced crops for manufactured ingredients in protein and fibre markets. To overcome logistics challenges a hub-and-spoke model is being pursued, with advanced processing in a central location supported by regional spokes that leverage local production, micro-climates, and expertise. 

Collaboration is essential at all levels — from solving logistics through a hub-and-spoke model to building partnerships across the value chain. At the system level, we  must work together to grow the industry and expand the pie.”

(Steve Tiley, MD, Wandarra, QLD)  

• Murray Industrial Hemp began in 2020 when the Western Murray Land Improvement Group united farmers to explore diversification in response to water challenges. It has since evolved into a cluster of 15 growers now raising capital for a processing precinct.
• In South Australia, a growing and processing hub is coming together on the Adelaide Plains, driven by three passionate individuals and their strategic partners in Research and Development and applied technology. The initial business is based on manufacturing and construction of sustainable modular housing.
• In NSW, workshops have been exploring the potential for a hemp hub at Lithgow on the Central Tablelands west of Sydney.
• In Gippsland, Victoria, opportunities have been scoped through the lens of energy and forestry transition and leveraging existing regional strengths, with Orbost — a former timber town — actively brokering partnerships to position itself as a future hemp hub.
• In New Zealand’s Canterbury region, the concentration of activity by the likes of Rubisco, Midlands, Mainland Hemp, and Hemp NZ — combined with strong industry leadership and agronomic suitability — has led some to describe it as the country’s “hempquarters.” The region is now also attracting increased attention from government and researchers, particularly around the development of hemp products ranging from food and nutraceuticals through to textiles and advanced biocomposites designed to replace fibreglass and other carbon-intensive materials.

Hubs  and Clusters – No Hard and Fast Rules

Language in this space can be confusing, and it is helpful to make a distinction between hubs and clusters. A hub usually refers to an intentional physical node or precinct — a concentrated centre of activity, infrastructure, or experimentation. Hubs often form around a key facility, anchor firm, or shared resource that draws in related activity and creates a focal point for innovation.

Clusters, by contrast, carry two distinct but related meanings. First, they serve as an explanation of occurrence: why some industries organically emerge and thrive in particular regions. Clusters grow out of the density of linkages between firms, suppliers, researchers, communities, and institutions. As Michael Porter — a leading Harvard strategist best known for his work on competitive advantage and cluster theory — observed, competitive advantage is often generated not by individual actors but through the networks that foster knowledge spillovers, specialised skills, and collaboration. Second, cluster practice has evolved into deliberate structural arrangements designed to make impactful collaboration easier across innovation ecosystems. In this sense, clusters represent a networked structure that could link multiple hubs and actors across the value chain and innovation ecosystem, supported by intentional collaboration, governance, and collective leadership.

This thinking is reinforced by international experience – particularly as it relates to EU cluster and smart specialisation (S3) policy, which shows that regions build long-term advantage by specialising in distinctive strengths rather than spreading thinly across many sectors, and that success depends on co-investment by businesses, governments, and research institutions. Crucially, such approaches highlight the importance of cross-sectoral spillovers — the way, for example, a crop like hemp simultaneously connects agriculture, construction, health, textiles, and bio-based manufacturing into a reinforcing innovation ecosystem.

The idea of Canterbury as New Zealand’s “hempquarters” illustrates these dynamics in practice. Investments in processing infrastructure have catalysed activity well beyond farming — attracting growers, researchers, and policymakers, while sparking innovation across food, textiles, construction materials, and advanced biocomposites. Building on advantages such as fertile plains, irrigation, and a strong farming culture, the region demonstrates how cross-sectoral spillovers can anchor local strengths while positioning a place as a globally relevant node in a wider innovation ecosystem.

In practice, hubs and clusters frequently overlap. Hubs can evolve into clusters, and formally structured clusters can host multiple hubs. What matters most is ensuring that structural arrangements reduce fragmentation, enable collaboration, and strengthen competitiveness — creating the conditions for industries such as hemp to scale from promising local initiatives into globally connected ecosystems.

Co-ordination and Cooperation Across a Busy Innovation Ecosystem

At national levels, the Australian Hemp Council, the Australian Industrial Hemp Alliance, and the New Zealand Hemp Industries Association are working to align research, standards, advocacy, and regulation across jurisdictions. Beneath these sit a growing number of state and regional groups, each adding momentum to industry development.

AgriFutures Australia — one of 15 Australian Rural Research and Development Corporations (RDCs), funded through a combination of industry levies and Australian Government contributions — has committed to a strategic RD&E program (2022–2027) spanning agronomy, markets, and value-chain opportunities. Together, these initiatives are laying important foundations for industry credibility and growth.

The research landscape is a very busy space. From seed genetics through to production systems and end-use applications, the number of organisations involved is extensive. The same is true for the expanding community of growers, processors, and product developers driving innovation in cultivation, harvesting, and processing. Beyond the hemp sector itself, there are also critical actors in spillover domains — those advancing sustainable construction materials, novel food and wellbeing products, advanced composites, and circular economy solutions.

This diversity of activity underscores both the strength and the challenge of the hemp ecosystem. Momentum is real, but so too is the risk of fragmentation. The central task is therefore one of governance and coordination: what forms of cooperation will best enable the industry not only to grow, but to deliver the wider systemic shifts it has the potential to unlock? Governance here should not be understood as top-down control, but as the design of collaboration-enabling models — approaches that build shared agendas, foster trust, and provide the connective tissue across a diverse ecosystem of actors. In this sense, governance is about enabling cooperation, reducing fragmentation, and giving the industry and all the ecosystem actors the backbone support it needs to learn, adapt, and scale.

“Industrial hemp has real potential to complement the strengths of our food and fibre sector, but only through authentic collaboration. Food & Fibre Gippsland is ready to act as a neutral backbone, aligning stakeholders and supporting the collective effort needed to make it a reality.”

(Simon Johnson, CEO Food & Fibre Gippsland, Vic)

There are no ready-made playbooks. Development of the industrial hemp industry requires not just technological or sector-specific innovation, but innovation in the ways of working together — applying design thinking to collaboration, governance, and shared value creation. It also means engaging with the cultures, mindsets, and agendas of different actors — from farmers and entrepreneurs to policymakers, researchers, investors, and communities — recognising that alignment and trust are as vital as infrastructure and capital.           

Effective coordination must therefore go beyond business-as-usual. It requires ecosystemic mechanisms that seek to engage all key actors — from growers and processors to researchers, policymakers, and spillover sectors. A shared agenda with rolling, mission-driven initiatives, coupled with dynamic regional capabilities to sense, seize, and transform opportunities, can provide structure and momentum. Supported by digital infrastructure, these approaches could enable transformational innovation — positioning hemp not just as an industry, but as a catalyst for regenerative, circular, and place-based futures.

National leadership organisations are already beginning to experiment with digital tools for knowledge sharing and connectivity — curated information hubs, webinar series, and ideation platforms that bring growers, processors, researchers, and policymakers into shared conversations. These are valuable first steps, but the opportunity for innovation in this space is far greater. Purpose-built digital platforms could map capabilities, track carbon and value flows across supply chains, identify emerging hotspots, and connect actors with global partners. Investment in such infrastructure could not only reduce fragmentation but also accelerate collaboration and strengthen the systemic linkages and spillovers needed for the hemp industry to mature into a coordinated, globally relevant ecosystem.

A  Live Case Study for Practitioners Working in Clusters and Across Innovation  Ecosystems

For practitioners engaged in clusters and innovation ecosystems, the emerging hemp industry offers a live case study in the challenges and opportunities of activating a new sector from the ground up. It highlights the value of systems thinking — recognising that hemp’s potential lies not in any single product but in the reinforcing cycles it enables across regenerative farming, sustainable housing, advanced manufacturing, new bio-based industries, and so on.

Emerging industries gain traction when local strengths are aligned with global market opportunities and when investment is directed toward areas with the greatest potential for systemic change. Industrial hemp is a clear example: it forges systemic linkages across farming, processing, manufacturing, research, and policy, while generating spillover benefits in construction, textiles, health, carbon markets, and regenerative agriculture. To realise this potential, such linkages and spillovers must not be left to chance, but actively recognised, nurtured, and deliberately supported through the right mix of policy, investment, and collaborative practice.

Equally important is the role of innovation intermediaries that bridge science, industry, and community. For hemp to scale, dedicated translational R&D capacity is essential — from test facilities for processing, to demonstration hubs for hemp-based building materials and biocomposites, to applied research that measures and verifies hemp’s carbon benefits through lifecycle assessments and carbon accounting frameworks. Crucially, this infrastructure should be developed on principles of distributed scale rather than centralised scale — enabling multiple regions to cultivate context-specific hubs of expertise and capability, while also fostering the new skills, technologies, and organisational capacities the industry will require as it matures. These connectors help de-risk investment, accelerate knowledge transfer, and create the enabling conditions for long-term credibility and growth.

As the hemp industry continues to evolve across Oceania, and recognising that every local context is different, the application of cluster theory and practice offers clear value. Innovation intermediaries and cluster organisations can act as connectors and amplifiers, sharing lessons, forging partnerships, and scaling opportunities. By embedding these principles, the industry can avoid becoming a patchwork of isolated initiatives and instead mature into a coordinated ecosystem — one with global relevance and the capacity to drive much-needed systemic shifts toward more sustainable, circular, and place-based futures.

“When we lean into genuine partnerships  and are alert to new opportunities, the future opens up with possibilities we  could never have imagined alone.”

(Tony Burfield, 3i Hempworks, SA)

A  Call to Action: Building on What’s Possible

The opportunity for industrial hemp is real, and much of the groundwork has already been laid — from early-stage hubs and committed growers to growing investment, research, and community partnerships. The challenge now is not about whether hemp has potential, but how to build on what exists to fast-track its development into a resilient and truly connected industry.

“Industrial hemp is entering a defining moment. Its real potential lies in tackling practical challenges, from sustainable housing to resilient farming and low-carbon manufacturing and in reinforcing the industries that underpin our economy. Unlocking this requires  collective action: a sector that grows through collaboration, scales with  purpose, and delivers solutions for both today and the future.”

Matthew Lariba-Taing
Interim President, Australian Hemp Council

This requires aligning supportive policy settings, experimenting with new organising models and collaborative ways of working, and ensuring that emerging hubs are nurtured while clusters provide the backbone structures for scaling. Above all, progress must be guided by systems thinking — so that hemp is not developed as a narrow commodity market, but as a catalyst for regenerative, circular, and place-based futures that deliver real social, environmental, and economic value.

To advance this conversation and turn opportunity into action, several critical questions emerge:

• What policy shifts are required to create the right enabling environment?
• What organising models and ways of working will best support the industry’s growth? What are the collective critical capabilities that sit alongside that?
• How can hubs be nurtured while clusters provide the structural arrangements and backbone support needed for scaling?
• What kinds of data platforms can genuinely engage actors across the ecosystem, provide visibility, and attract participation by making collaboration easier and more valuable?
• What business models are best suited to shared infrastructure and intermediaries, ensuring that platforms, facilities, and coordination mechanisms are sustainable and deliver collective benefit?
• How can growth be guided by systems thinking, so that we build not just markets, but futures that are regenerative, circular, and place-based?
• Is there a single unifying purpose that can bring all actors together — while recognising that individual needs and expectations will inevitably sit underneath? What is that shared purpose statement?
• How can the hemp industry align with spillover domains — such as sustainable construction, food and wellbeing, advanced composites, and circular economy initiatives — particularly where these intersect with other place-based initiatives, needs, and regional strengths?

These are not questions any single actor can answer. They are an invitation for governments, industry, researchers, communities, and innovation networks to come together — to learn from what has already been achieved, to align effort and investment, and to accelerate the emergence of an industry with the potential to shape a more sustainable and resilient future. By staying alert, leaning into what is possible, and embracing emergent opportunities, hemp can become not only a new industry but a cornerstone of an emerging sustainable future that benefits people, places, and the planet.

Insight prepared by Dr Nicola Watts, TCI Oceania Secretariat and a place-based facilitator in the emerging industrial hemp industry.