Proposed federal legislation could reduce uncertainty, open up hemp-based and cannabidiol products market.
The CBD, or cannabidiol, segment is one of the fastest-growing within the cannabis industry. Overall, the CBD market has accelerated at a tremendous pace as various studies have debunked the common misconceptions swirling around the compound.
CBD is now known to offer therapeutic effects just like tetrahydrocannabinol, or THC, however, it is the non-psychoactive derivative of cannabis. CBD is also legally available within the U.S. as long as it contains 0.3% or less THC, making it very accessible for consumers.
And due to its current status under federal law, CBD is expected to be the more explosive market compared to its counterparts. Back in 2018, the U.S. Food and Drug Administration decided to delist CBD as a Schedule 1 drug. Shortly after, the U.S. House passed the Farm Bill, allowing for the cultivation of hemp, which CBD is primarily derived from.
In 2017, the hemp-derived CBD product segment delivered $190 M in sales, accounting for 23% of the overall market. Furthermore, the hemp food segment, which delivered $137 M in sales, accounted for 17% of the hemp market in the same year.
Now, the food segment is expected to reach $212 M by 2022 as the segment continues to see major investments, primarily by large beverage corporations looking to enter into the cannabis-infused beverage industry. And according to data compiled by QY Research, the global cannabidiol market is expected to increase from $303 M in 2018 to $2.28 B by 2025 while registering a CAGR of 33.5%.
Various CBD products have gained a favorable reputation among health-conscious consumers, as full-spectrum CBD oils provide consumers with protein, fiber and essential fatty acids, according to Dixie Botanicals. Moreover, the oil can also be added to other products such as tinctures, topicals, capsules or beverages.
Overall, full-spectrum oil also contains all 20 amino acids, including the nine essential amino acids that the human body processes on its own. In particular, the CBD edible and beverage segment is quickly gaining traction because consumers are ingesting products simply for relaxation.
“On one hand, yes, it’s really surprising to see this young industry be at such huge numbers so quickly—and still kind of pulling itself together—and on the other side, I don’t think it’s a surprise at all, because it’s about time,” said Lex Pelger, science director at Bluebird Botanicals, in an interview with Cannabis Dispensary. “With such a long human history of cannabis being an important plant, it makes sense that this is just exploding back onto the public consciousness like it does every couple decades.”