Industrial quality hemp can legally be grown in the Northern Territory for the first time.
Authorities expect the first crops will be planted next year.
Katherine has long been highlighted as an optimum location for the growing of hemp, and maybe later, medicinal cannabis.
A plot of cannabis was successfully grown at the town's research farm last year.
Today the the NT Parliament passed laws allowing for a new hemp industry in the NT.
The move paves the way for an exciting new opportunity for Territory farmers as soon as next dry season, according to the government.
Farmers say they are already excited about the opportunities this new crop would bring.
The legislation enables farmers and researchers to keep working together developing an NT hemp sector, facilitating investment and job creation opportunities in regional areas.
The Bill, introduced in May, exists to create a required framework in order to regulate the development and operation of an industrial hemp industry in the Territory, capitalising on emerging market opportunities.
Under the bill, a licensing system now exists for possession, cultivation, supply, processing and research of Industrial hemp, and covers the various prohibitions, necessary enforcement provisions, offences and miscellaneous arrangements to support this industry.
The industry will see two main opportunities grow from the passing of this new bill, both a fibre and grain industry (THC levels under 1%), and a viable seed industry (THC levels under 0.5%).*
The NT will have a competitive advantage in the emerging industrial hemp market in Australia, with the potential to supply a viable seed industry to other Australian jurisdictions via a dry season crop, supplying viable seed the rest of Australia for summer planting.
The potential for two dry season crops for Territory farms each Dry Season increases the potential return to farmers, with hemp grain currently garnering a farm-gate price of around $3000 per ton.
Other uses for industrial hemp fibre include line, rope, clothing, sunscreen, shampoo, lotions, soap, biofuels, stock feed, paper, building materials, and as a highly nutritious food source.
Primary Industries and Resources Minister Paul Kirby said: "The development of this industry is a real green shoot for the jobs and export economy here in the Territory - diversifying our economy and creating local jobs.
"As an emerging superfood with many other uses, this industry will develop and grow as soon as next year, seeing our pastoralists given a new opportunity to diversity their crop offerings here in the Territory."
NT Farmers chief executive Paul Burke said: "NT farmers are really excited about the opportunities this new, emerging crop type may present the industry.
"Industrial hemp has real potential in our current climatic conditions and could be a viable new industry on a broadacre scale which is an exciting proposition.
"NT farmers looks forward to working with Government to facilitate some meaningful trials in the NT to explore the full potential of Industrial Hemp.
*THC, or Tetrahydrocannabinol, is the level of potential psychotropic properties in the industrial hemp plant, with levels above 1% considered to be Cannabis. Below 1% is widely considered to be safe for human and animal consumption.