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The global Legal Cannabis Market size is projected to increase by USD 54.57 billion and the market size is estimated to grow at a Compound annual growth rate (CAGR) of 21.6% between 2022 and 2027.
North America dominated the market during the forecast period. Key countries contributing to the market growth include the US, Canada, the UK, Germany, and Australia. Several factors play a crucial role in the market's growth, such as the number of countries decriminalizing and legalizing cannabis is rising, fueled by the growing purchasing power of millennials in the industry, and the recognized health benefits of medical cannabis.
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This shift in regulations not only increases the potential consumer base but also drives market growth. Moreover, it contributes to a change in societal attitudes towards cannabis, reducing stigma and boosting consumer acceptance. The demand for both recreational and medicinal products is on the rise as a result. Clear frameworks provide structure for cultivation, production, distribution, and sale, attracting investment, promoting entrepreneurship, and stimulating market growth. By operating within established regulations, companies can thrive and contribute to the growth of the market.
Traditionally limited to basic options like baked goods and candies, edibles are now becoming more sophisticated and diverse. This shift is driven by consumers' increasing health consciousness, seeking edibles that offer both nutritional benefits and therapeutic effects. Additionally, consumer education about different cannabis types and their specific properties has prompted companies to introduce edibles tailored to deliver targeted effects such as relaxation, pain relief, or energy boost. These factors are expected to fuel growth in the market.
Many investment organizations, such as banks and other financial institutions, have expressed their reluctance to invest in the industry at regular intervals. Most investment organizations in the US and Canada have declined to provide loans to companies in the market. They have also declined to take a share in the revenue generated from the market, including hemp, marijuana, and other drug-related businesses. This has resulted in the lack of adequate banking options for companies, which causes significant problems in the diversion of funds and accounting. Owing to the lack of support from government organizations, companies in the market always look up to investors in the private sector to obtain the required capital. Consequently, their revenues are being reduced by paying higher interest rates. Additionally, in many Islamic countries, the use of cannabis is completely banned on religious grounds. Thus, there is no opportunity for foreign investment in these countries and this does not allow the sector to grow. During the forecast period, these factors are expected to hamper the market growth and trends.
North America is estimated to contribute 92% to the growth of the global 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, medical cannabis is legal in the US and Canada. Several government initiatives to legalize medical cannabis are primarily driving the growth of the market in the region. In 2022, North America was the largest region in the market. The market in North America is moderately concentrated due to the presence of several regional and global companies.
The market share growth by the medical Cannabis segment will be significant during the forecast period. The medical cannabis segment of the market refers to the use of cannabis and its derivatives for therapeutic purposes. Medical cannabis has been found to have potential therapeutic benefits for a range of medical conditions and symptoms.
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The medical cannabis segment was valued at USD 8.80 billion in 2017 and continued to grow until 2021. Medical products are typically prescribed or recommended by healthcare professionals based on individual patient needs. The industry is supported by ongoing research and clinical trials to further understand its potential therapeutic benefits, optimize formulations, and identify new medical applications. A clinical trial is necessary for the purpose of obtaining scientific information and gathering data regarding safety, efficacy, dosage, or interaction with other medicinal products.
The recreational cannabis segment of the market thrives in regions where cannabis has been legalized for adult use. Countries such as Canada, Uruguay, and several states in the US have implemented regulatory frameworks that allow the production, sale, and consumption of cannabis for recreational purposes. These regulations often outline age restrictions, possession limits, and licensing requirements for businesses operating in the recreational cannabis industry. The recreational segment offers a wide range of products to cater to different consumer preferences. This includes dried cannabis flowers, pre-rolled joints, cannabis-infused edibles, beverages, concentrates, extracts, and topical products. Such factors are expected to drive the growth of the recreational cannabis segment of the market 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 market trends and analysis 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 is undergoing significant evolution, particularly in the medical field, where cannabinoids serve medicinal purposes for chronic pain, nausea, and epilepsy seizures, notably in regions like California, Portugal, and Canada. Despite being a Schedule I drug in many countries, the FDA and scientific community explore its efficacy. CBD products gain traction for various ailments, including anxiety and sleep disorders. The Cannabis Act (Bill C-45) in Canada and the legalization trend across North America challenge the illicit market. With ongoing research and support from organizations like the California Pharmacists Association, cannabis emerges as a promising therapeutic option, expanding its reach globally.
The market growth analysis 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.
Legal Cannabis Market Scope |
|
Market Report Coverage |
Details |
Page number |
163 |
Base year |
2022 |
Historic period |
2017-2021 |
Forecast period |
2023-2027 |
Growth momentum & CAGR |
Accelerate at a CAGR of 21.6% |
Market growth 2023-2027 |
USD 54.57 billion |
Market structure |
Fragmented |
YoY growth 2022-2023(%) |
19.82 |
Regional analysis |
North America, Europe, APAC, South America, and Middle East and Africa |
Performing market contribution |
North America at 92% |
Key countries |
US, Canada, Australia, Germany, and UK |
Competitive landscape |
Leading companies, Market Positioning of companies, Competitive Strategies, and Industry Risks |
Key companies profiled |
Aurora Cannabis Inc., Bhang Corp., Cannabinoid Creations, Cannoid LLC, Canopy Growth Corp., CBD American Shaman LLC, Cronos Group Inc., CV Sciences Inc., Elixinol Wellness Ltd., Folium Biosciences, Jazz Pharmaceuticals Plc, Medical Marijuana Inc., MediPharm Labs Inc., Mentor Capital Inc., PharmaHemp d.o.o., Tikun Olam, Tilray Brands Inc., and Unrivaled Brands Inc. |
Market dynamics |
Parent market analysis, 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 research and growth report has not included the data that you are looking for, you can reach out to our analysts and get segments customized. |
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