Economic Viability and Market Potential of Cannabis Cultivation in Malawi: An Empirical Analysis of Smallholder Farmer Perspectives

Abstract

Malawi’s agricultural economy, historically dependent on tobacco, faces structural vulnerability as global demand declines, necessitating urgent diversification. The legalization of industrial and medicinal cannabis in 2020 provides a transformative opportunity for rural livelihoods, yet empirical evidence on its economic feasibility remains limited. This study quantitatively evaluates the economic and market dynamics of smallholder cannabis cultivation in Malawi. A cross-sectional survey of 60 licensed farmers was conducted across five major agricultural districts Blantyre, Lilongwe, Zomba, Rumphi, and Mzimba. Descriptive statistics were applied to characterize production systems, cost–benefit analysis assessed profitability, one-way Analysis of Variance (ANOVA) tested cost differentials, and Chi-square (χ2\chi^2χ2) tests examined relationships among categorical variables. The mean production cost per grower was MWK 203,443.72 (± SD 18,188.95). ANOVA revealed no significant variation across region, cultivar, or experience level, indicating uniform production input structures. Sativa was the dominant strain (80%), while 60% of farmers experienced income increases. However, χ2\chi^2χ2 tests showed income change was independent of cultivation experience and water management, highlighting structural rather than individual determinants of profitability. Regulatory costs (56.7%) and restricted market access (65%) emerged as key constraints. The study concludes that cannabis is economically viable but requires inclusive policies, financial access, and streamlined regulations to achieve sustainable and equitable sectoral growth.