Cannabis Market By Product (Flowers, Concentrates, Edibles, Topical & Tinctures, and Others), Compound (Tetrahydrocannabinol, Cannabidiol, and Balanced THC & CBD), and Application (Medical, Recreational and Others), and Region - Market Perspective, Market Intelligence, Comprehensive Analysis, Historical Data, and Forecast for 2023 - 2032
The global Cannabis Market size was worth around USD 24.65 billion in 2022 and is estimated to generate a revenue of around USD 143.64 billion by 2032 at a staggering CAGR of 19.27% between 2023 and 2032.
Cannabis has become a popular alternative treatment for various symptoms and medical conditions, including chronic pain, cancer, and mental health disorders. This is due to the therapeutic benefits of its two primary cannabinoids, tetrahydrocannabinol (THC) and cannabidiol (CBD), which are often prescribed to patients with long-term illnesses like Alzheimer's, Parkinson's, and neurological problems. The increasing demand for cannabis oil is driven by its potential to improve wellness and health, as it is primarily used to alleviate symptoms of cancer, inflammation, anxiety, and depression.
Despite its potential benefits, the cannabis market faces challenges related to the strict regulations governing its sale and manufacturing in different countries. Furthermore, varying laws and regulations across different countries create obstacles to the global market's growth. However, the pharmaceutical and biotechnology sectors' presence and their innovative approaches to cannabis research and development fuel the market's expansion.
As the worldwide cannabis market is anticipated to grow significantly in the coming years, stakeholders and producers must navigate the challenges posed by regulatory frameworks and laws in different countries. Through innovative and responsible approaches, the cannabis industry can continue to provide alternative treatments and improved health outcomes for patients worldwide.
- Based on product, the flowers segment held the largest market share
- Based on the compound, the balanced THC & CBD segment dominated the market
- Based on application, the medical segment generated the highest revenue
- On the basis of region, North America accounted largest market share
Technological Advancements and Innovation Driving the Growth of the Cannabis Market
Cannabis production and consumption are rapidly increasing in many countries worldwide, leading to a significant shift towards technical innovation for the development of cannabis-based products. With the legalization of cannabis for medical purposes in more countries, the demand for advanced technology in the industry is becoming increasingly crucial. In the past, cannabis farmers focused mainly on minimal processing of the plant. However, with advancements in technology, growers are now producing a variety of cannabis products such as edibles, capsules, oils for vaping, and gummies.
To meet the growing demand for cannabis, companies like Eaze, a California-based firm, are leveraging technology to deliver cannabis through an app. By utilizing user data, Eaze helps medical marijuana dealers estimate supply and demand, change inventory, and delivery based on the information provided. Another startup, Cannabase, employs analytics to assist businesses in predicting patterns, pricing shifts, and volume swings in the cannabis market.
As competition in the cannabis sector increases, prices are expected to decline, making it even more crucial for firms to use big data to understand their competitors, select the best sales strategies, and focus on the relevant markets. Moreover, genetic engineering is gaining traction in the sector, with CanBreed using CRISPR editing to create seeds.
Legal and Regulatory Hurdles to Challenge Cannabis Market Growth
The legal and regulatory hurdles facing the cannabis industry have had a significant impact on the growth and development of the industry. Despite the fact that more than 21 US states and over 47 countries have legalized cannabis for medical or recreational use However, it remains illegal at the US federal level, creating a complex legal landscape that can be difficult for businesses to navigate. In addition, the patchwork of state-level regulations and licensing requirements, combined with the lack of access to banking and financial services, has made it difficult for cannabis businesses to operate effectively and compete with the black market.
According to a report by the National Cannabis Industry Association, the lack of access to banking services and the high cost of compliance with state-level regulations are among the biggest challenges facing the cannabis industry. The report found that only about 20% of cannabis businesses have access to banking services, while the majority are forced to operate on a cash-only basis. This makes it difficult for these businesses to obtain loans, process electronic payments, and access other financial services.
The report also found that the cost of compliance with state-level regulations can be significant, with some businesses spending up to 25% of their revenue on compliance-related expenses. In addition, the lack of consistency in regulations and licensing requirements from state to state can create additional challenges for businesses operating in multiple states.
March 2022: Martha Stewart, with Marquee Brands, and Canopy Growth Corporation Releases a sample of 15 new flavored CBD gummies.
April 2021: The Supreme Cannabis Company, Inc. and Canopy Growth Corporation signed a legally binding agreement for the former to buy the latter. This acquisition would strengthen the company's market position while also assisting in the expansion of its product line
Based on product, the market is categorized into flowers, concentrates, edibles, topical & tinctures, and others. The flower segment dominates the market as marijuana flower or "bud," is the most widely used consumable in the global cannabis market. Marijuana flowers typically contain a range of cannabinoids, with THC (tetrahydrocannabinol) being the most prominent, typically ranging from 15% to 30%. They also contain minor amounts of other cannabinoids, such as CBD (cannabidiol), and other terpenes that contribute to the overall experience of consuming cannabis.
The flowers segment of the cannabis market has remained the most popular because of its versatility in consumption. It can be smoked, vaporized, or used to make edibles, tinctures, and concentrates. The buds' potency, flavor, and aroma make them a preferred choice among both recreational and medical cannabis consumers.
The global (legal) market for concentrates, which primarily consists of CO2 oil, butane hash oil, or "BHO," wax, kief, shatter, budder, live resin, and ice water hash is expanding at an exponential rate due to the favorable demand dynamics, large consumer base, and greater accessibility and penetration of marijuana products, particularly in western markets. One of the factors contributing to the growth of the legal market for concentrates is the belief that consuming concentrates by vaporizing or ingesting them is a healthier alternative to smoking cannabis flowers. This perception has contributed to the rising popularity of concentrates among cannabis consumers, particularly those seeking to avoid the potential negative effects of smoking.
On the basis of the compound, the market is categorized into Tetrahydrocannabinol, Cannabidiol, and Balanced THC & CBD. The balanced THC & CBD segment dominates the market. The balanced product has a 1:1 CBD to THC ratio. The interaction of the psychoactive results in a unique experience and effect for its consumers.
The cannabis market can be divided into two main segments: medical and recreational use. The medical segment is projected to experience significant growth in the coming years due to the increasing use of cannabinoids or cannabinoid-like substances for medicinal purposes in pharmaceutical products. Notable medications made from hemp include Cesamet, Marinol, and Sativex, which have been used to treat conditions such as multiple sclerosis, treatment-resistant epilepsy, and chronic pain.
Cannabidiol (CBD) has gained particular attention for its potential health benefits in treating a variety of illnesses, including anxiety, chronic pain, epilepsy, and cancer. This has led to a rise in the medical marijuana industry, which has been made possible by the growing health and wellness trend permeating the global economy.
Topical applications of cannabis products, such as lotions, creams, and lubricants, represent a small share of the market. However, these products are gaining popularity as they are infused with ingredients that can provide relief from muscle soreness, inflammation, headaches, cramping, and other ailments.
North America is Dominating the Market Share Due to Increasing Government Support
The United States is currently the largest cannabis market in North America, with several states legalizing marijuana for both medical and recreational use. As of the end of 2022, more than 21 states have legalized cannabis use for recreational purposes, while 37 states and the District of Columbia allow the use of cannabis for medical purposes. The increasing awareness of the therapeutic uses of marijuana and its perceived safety compared to alcohol are driving this trend.
The growing number of states legalizing marijuana is opening up numerous opportunities for market participants. The industry is further maturing through mega-mergers, sales growth, and high-value investments. For instance, Tilray, a multinational pharmaceutical, cannabis-related lifestyle, and consumer packaged goods firm, acquired Aphria, a global producer and distributor of medical and recreational cannabis, for USD 2.4 billion in April 2021. In October of the same year, Trulieve, a vertically integrated cannabis company, purchased Harvest Health and Recreation, a medical cannabis business, for USD 2.3 billion.
In addition, there are numerous petition drives and legislative initiatives for medicinal marijuana programs in states like Kansas, Nebraska, North Carolina, and South Carolina. All these factors indicate that the cannabis market in North America, particularly in the US, is growing and evolving rapidly, creating a wide range of opportunities for companies and investors alike.
- Aurora Cannabis Inc.
- Tilary, Inc.
- VIVO Cannabis Inc.
- Lexaria Bioscience
- Organigram Holdings Inc.
- Green Thumb Industries Inc.
- Medical Marijuana, Inc.
- HEXO Corp
- Harvest Health & Recreation, Inc.
The global cannabis market is segmented as follows:
- Topical & Tinctures
- Balanced THC & CBD
- North America
- The U.S.
- The UK
- Nordic countries
- Benelux Reunion
- The Netherlands
- Rest of Europe
- Asia Pacific
- New Zealand
- South Korea
- Southeast Asia
- Rest of Southeast Asia
- Rest of Asia Pacific
- The Middle East & Africa
- Saudi Arabia
- South Africa
- Rest of the Middle East & Africa
- Latin America
- Rest of Latin America
Cannabis Market By Product