The bill, which introduces a new licensing scheme to allow the production of industrial hemp in NSW, has now passed through both Houses of NSW Parliament.

Minister for Primary Industries Ian Macdonald says the licensing scheme means industrial hemp crops can be planted this coming spring.

"It will pave the way for a potentially lucrative industrial hemp industry, providing farmers with the additional option of another fast-growing summer crop that can be used in rotation with winter grain crops," Mr Macdonald said.

"Industrial hemp fibre can be used as a base for skin care products, in paints, paper products and textiles, load bearing masonry for building, insulation, as an additive to wool in soft textured durable yarns and also as an alternative to fibreglass."

NSW Department of Primary Industries will now work with farmers and other groups to create the necessary regulation which will ensure the crop is grown only under licence and only by applicants of good repute.

"Following consultation in August with potential growers and other interested parties, the regulation will be finalised in September," Mr Macdonald said.

"The licensing scheme is designed to prevent industrial hemp being used to camouflage an illicit crop of high-THC cannabis, or marijuana, and we will continue to work closely with NSW Police to ensure law enforcement is not compromised.

"Properties growing industrial hemp will be audited and inspected regularly, to identify any illicit plants or any breaches of licence conditions."

Mr Macdonald said there was growing support from the agricultural sector for the development of the new industry.

"This is a direct result of the environmentally-friendly nature of industrial hemp and a perceived interest for hemp products in the market," he said.

* For information on the licensing scheme or on industrial hemp call NSW DPI on (02) 6938 1966.