Federal law is hampering the creation of a multi-million dollar hemp ice-cream factory in Tasmania, and the company at the centre of the issue has revealed that it will now look to South Africa for a site.

Hemp Foods Australia is involved in the development of the hemp industry but has found the commercial production of its ice cream hampered by laws that ban the consumption of hemp products. The Queensland-based company found it necessary to conduct trials of the product secretly, and has confirmed that export clients are waiting for the product in Japan and the US.

Managing director Paul Benhaim believes that the government is dragging its feet over reforms that will make the drug-free strands of the cannabis plant legal.

The company, which works with the European Hemp Foods Association, explains that hemp contains only negligible quantities of the legally objectionable hallucinogenic THC.

Benhaim is due to fly to South Africa on Friday, in order to investigate potential sites for the factory.

To read an analysis of the hemp foods industry, click here.