TASMANIA'S success as the world's biggest legal poppy producer has earned it the right to grow marijuana for medical trials in New South Wales.

NSW Premier Mike Baird and Tasmanian Premier Will Hodgman have signed a memorandum of understanding sketching out the states' involvement in the trials and research.

The southern state has grown poppies commercially since the late 1960s, with fields now covering an area 20,000 times larger than the Melbourne Cricket Ground.

Today it grows more than half of the world's legal pharmaceutical supply for use in opiate drugs.

Like the marijuana crops it will soon grow, poppy theft for illegal use has always been a concern for Tasmanian Government and the state has one of the most heavily guarded industries of its kind in the world.

Still, since 2012, two people have died after stealing poppies.

The move into marijuana farming follows company AusCann's recent announcement it would start planting crops on Christmas Island.

Tasmania will not be asked to help fund the trials, but Mr Hodgman said the agreement set the scene for his state to participate.

"These matters concerning the ability to cultivate the crop and to ensure a safe transition into NSW will be determined by our health department and other experts," he told the Examiner.

It is unclear whether the deal means NSW has completely missed out on growing the plant for the trials under controlled laboratory conditions.

Southern Cross University director of plant science Professor Graham King, a member of the trials' advisory council, will play a key role in deciding what strains are grown, and where.

Last week he said there was scope to "grow different types of crops from Tasmania all the way north".

Clinical trials will be carried out targeting terminally ill adults, children with drug-resistant epilepsy and chemotherapy patients.

-APN NEWSDESK