Will Annual CBD Sales Outpace Legal Cannabis?
While business isn’t exactly easy, both cannabis and CBD sales are booming at the macro level and revenue numbers should continue increasing in both the short and long-term as more markets open up and potential consumers get better informed. As has been covered, the combined global cannabis market could generate $15 billion in revenue this year, with that number increasing to nearly $45 billion by 2024. This overall number includes the regular cannabis sales that most people think of (flower, edibles, oils, etc.) combined with CBD products. Many are expecting bigger things for the CBD industry, as a recent Canadian CBD company’s expansion into Europe is betting on, even with the current uncertainty with the European Union’s CBD law. Could CBD’s market share actually surpass cannabis’ in the near future? Some analysts think so, as Bloomberg reported:
Researchers estimate the market for CBD in the U.S. alone could be worth almost $24 billion by 2023. In Canada sales of legal cannabis may reach $4.7 billion by that time, up from about $570 million last year, according to BDS Analytics. Annual sales of CBD could potentially be larger than those of marijuana, analysts say, because of the large number of products in which it can be used.
Investors are pouring money into massive CBD extraction facilities and processing plants in the U.S., hoping to be ready when Coca-Cola Co., Procter & Gamble Co., and other consumer giants finally embrace cannabis. Colorado CBD company Mile High Labs has developed technology to remove unrefined hemp extract from the plant, and it recently paid $18.8 million for a 400,000-square-foot former Novartis factory where it will make products such as lotions and tinctures.
American farmers are plowing into the hemp industry in Colorado, Kentucky, Montana, Oregon, and other states. This year, more than 200,000 acres of hemp are licensed to be planted in the U.S., up from roughly 25,000 two years ago. Asia, which has a long history with natural medicines, is also seeing growing interest in cannabis. In 2017, China planted at least 113,000 acres of hemp, according to New Frontier, an industry researcher. Cultivation is also on the rise in Colombia, Greece, Jamaica, and even the southern African nation of Lesotho. “You get the domino effect: The farmer in Bulgaria looking across at peers in Greece and asking questions, putting pressure on the government to make similar steps,” says Shane MacGuill, an analyst at Euromonitor International. “The more it happens, the more quickly we get the spread of cultivation.”
“The more it happens, the more quickly we get the spread of cultivation,” is certainly a mantra that fits the general cannabis industry, whether it is the full plant or CBD extractions. As we make progress around the world, we create momentum that carries itself across borders. While it is hard to tell exactly which direction the cannabis and hemp industries will go, we can definitely expect market growth and for the overall future to remain very bright.
The International Cannabis Business Conference in Vancouver, Canada, this September 15-16, is the industry event to learn the latest about the cannabis industry and to network with top investors and entrepreneurs. Discounted, early bird ticket sales end on August 21st.
