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The Cannabidiol market size is projected to increase by USD 23.02 billion at a CAGR of 16.28% between 2022 and 2027. Changes in legalization and regulations regarding CBD, such as the legalization of hemp-derived CBD in many countries, are creating new opportunities for market expansion. The growing health and wellness trends, where consumers are increasingly seeking natural and holistic remedies, are driving demand for CBD products. Additionally, the increasing popularity of CBD oil, known for its potential health benefits and versatility, is fueling market growth as more consumers incorporate it into their daily routines. Our report examines historic data from 2017 to 2021 besides analyzing the current market scenario.
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This market report extensively covers market segmentation by source (marijuana and hemp), distribution channel (offline and online), and geography (North America, Europe, APAC, South America, and the Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges.
In the global cannabidiol market, the online distribution channel has emerged as a major driver of revenue in 2022. It offers easy access to a wide range of cannabidiol products, backed by the popularity of online shopping and e-commerce platforms. Consumers benefit from competitive pricing, detailed information, and user reviews. Online channels also provide companies an opportunity to expand their consumer base and enter new markets, contributing to segment growth during the forecast period.
While online distribution is on the rise, the offline channel remains significant in the cannabidiol market. It offers personalized experiences, product visibility, and immediate purchases, enhancing customer trust and satisfaction. Educated professionals provide advice on product selection, ensuring the safety and legality of cannabidiol products. Such factors will drive the growth of the offline distribution channel during the forecast period.
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The marijuana segment is expected to witness significant market share growth during the forecast period. Marijuana can be consumed through various methods, such as smoking it in joints, pipes, or blunts or using more potent forms like hashish. However, medical usage is restricted in many countries, with limited circumstances allowing its use. Efforts by governments to legalize medical cannabis are anticipated to drive further growth in the CBD market during the forecast period.
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Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. In North America, the largest markets are the US and Canada due to the government legalization of medical cannabis and the presence of several companies. North America is a highly matured market for cannabis products due to a trend toward the legalization of cannabis products in various countries and the growing popularity of cannabidiol products.
Moreover, Canadian companies are legally permitted to export cannabidiol products to the US. In the US, which is one of the largest markets for medical cannabis, around 33 states have approved the use of cannabis for medical applications. Patients that are prescribed medical cannabis are issued a medical cannabis card, which serves as an identification card. It enables them to use the product on a doctor's recommendation.
The market is witnessing significant growth due to the increasing awareness of its health benefits. CBD, a non-psychoactive compound derived from marijuana, is known for its therapeutic properties, including its ability to alleviate anxiety and pain. The market is expanding rapidly, driven by the legalization of cannabis in various regions and the growing demand for CBD-infused products. Health and wellness stores, as well as commercial retailers like CVS Health and Rite Aid, are stocking CBD-infused body care products, edibles, topicals, and beverages. R&D activities and innovations in product development are further driving market growth, with companies like Abercrombie & Fitch and Thrive Cannabis actively participating in the market.
The legalization and regulatory changes for cannabidiol are driving market growth. The manufacturing, distribution, and sales of cannabidiol (CBD) products are being fueled by government recognition of the potential therapeutic uses of CBD and the adoption of favorable regulations. For instance, in the US, the 2018 Farm Bill legalized hemp cultivation, the primary source of CBD, leading to the commercialization of CBD products nationwide. This legalization has expanded consumer access to a variety of CBD products, including oils, capsules, edibles, and cosmetics. This expansion has also led to increased innovation and R&D activities in the global cannabidiol industry, driven by growing product demand and a supportive regulatory framework. Companies like Thrive Cannabis are leveraging these opportunities to advance the industry further. Similarly, countries like Germany, Switzerland, and Australia allow the sale of CBD products under specific conditions, ensuring product quality and consumer safety through adherence to regional regulations. This regulatory environment has also created new markets and employment opportunities, driving the growth of the CBD market in the forecast period.
The E-commerce industry's growth is a significant trend in the market. With increasing internet and smartphone usage, online shopping is becoming popular, especially among millennials. Platforms like Alibaba and Amazon offer convenience, security, and discounts, driving demand in the market. companies are targeting tech-savvy customers, expanding their reach. For instance, HempStreet launched new cannabis-based products on their Indian e-commerce site. Online sales also help companies reduce operating costs and overheads.
The high cost of cannabidiol products is challenging market growth. Prices may fluctuate, which especially impacts patients authorized to use medical cannabis in countries like Canada. Fluctuating prices are due to legislation which has caused the demand and price of cannabis products to increase. Like any product that has only hit the market recently and is experiencing high demand, cannabidiol products are experiencing price inflation.
Additionally, processes such as extraction and refinement of cannabidiol require special machinery and also take a long time, which further increases the price of cannabidiol oil. For instance, one of the commonly used extraction methods is expensive CO2 extraction. Moreover, to ensure compliance regarding potency, among other regulatory mandates, companies conduct a third-party lab analysis on every product sold. They are then issued a certificate of analysis that shows the amount of cannabinoid content in the product. Hence such factors will hamper market growth during the forecast period.
Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.
The research report also includes detailed analyses of the competitive landscape of the market and information about 15 market companies, including:
Qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.
The market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027.
The market is rapidly expanding due to the increasing demand for hemp-based products and growing awareness of the health benefits of cannabidiol. It encompasses a wide range of products, including skincare products targeting issues like acne and wrinkles. Companies like Arvisol are actively involved in this market, leveraging merger and acquisition (M&A) activity to strengthen their presence. CBD is gaining recognition for its potential in treating conditions such as epilepsy and schizophrenia, driving the demand for cannabis extracts, tinctures, and other forms. The market extends to various sectors, including pharmaceuticals, personal care products, and food and beverages, with both B2B and B2C segments contributing to its growth.
Market Scope |
|
Report Coverage |
Details |
Page number |
156 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 16.28% |
Market growth 2023-2027 |
USD 23.02 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
15.72 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 51% |
Key countries |
US, Canada, China, Germany, and UK |
Competitive landscape |
Leading Companies, Market Positioning of Companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Cannoid LLC, Canopy Growth Corp., Charlottes Web Holdings Inc., Cronos Group Inc., Elixinol, Endoca BV, Folium Biosciences, Isodiol International Inc., Medical Marijuana Inc., Medterra CBD, NuLeaf Naturals LLC, PharmaHemp d.o.o., Tikun Olam, Tilray Brands Inc., VIVO Cannabis Inc., Aurora Cannabis Inc., and Cannabis Science Inc. |
Market dynamics |
Parent market analysis, Market Forecasting, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, Market condition analysis for forecast period |
Customization purview |
If our market report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
We can help! Our analysts can customize this market research report to meet your requirements.
1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation by Source
7 Market Segmentation by Distribution Channel
8 Customer Landscape
9 Geographic Landscape
10 Drivers, Challenges, and Trends
11 Vendor Landscape
12 Vendor Analysis
13 Appendix
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