The Cannabis Market is USD 22.9 billion in 2020 and is projected to grow at a CAGR of 18.1% during the forecast period (2021-2026).
The imposition of lockdown limited consumers from visiting brick-and-mortar shops, many cannabis companies are heavily relying on social media and e-commerce platforms to market to consumers this year. Cannabis retail outlets, producers, manufacturers, distributors, and warehouses were deemed to be essential services by the Alberta Government on March 30, 2020. As a result, cannabis businesses and services have continued to serve Albertans throughout the COVID-19 pandemic.
- The drivers identified in the market are the medicinal properties of cannabis, increasing the legalization of cannabis, and increasing advances in genetic development and intellectual property of cannabis. For instance, in January 2018, the Australian government allowed cannabis producers in the region to export medical cannabis and its products in the global market.
- North America Dominates the market. The cannabis industry has grown and matured significantly in the United States due to its use for medicinal purposes. As a Psychoactive drug, cannabis continues to find extensive favor among recreational and medicinal users in the United States.
Key Market Trends
Increasing Legalization of Cannabis is Driving the Market
Medicinal cannabis accounts for the majority share of the cannabis market. Many countries have legalized the usage of cannabis for medicinal purposes such as Australia, Canada, Chile, Colombia, Germany, Greece, Israel, Italy, the Netherlands, Peru, Poland, Portugal, and Uruguay among others. The provinces in the United States, where cannabis has been legalized majorly, comprise the adult population, aged 50 years and above. Owing to the higher risk of chronic diseases post 50 years of age, this demographic profile is expected to boost the demand for cannabis in the country. According to Cannabis Europa, in Europe, France may catch up with Germany and the United Kingdom in legalizing medical cannabis by the end of 2020. Norway is exploring decriminalization of cannabis use and has some innovative harm-reduction policies in place. Furthermore, several civil society movements for reforms are emerging across Scandinavia, as well as in Sweden.
According to the US Government Accountability Office, under State Medical Marijuana Laws, symptoms and conditions that can be treated by cannabis include Alzheimerâ€™s disease, anorexia, HIV-AIDS, glaucoma, cancer, arthritis, epilepsy, nausea, pain, cachexia, Crohn's disease, migraines, multiple sclerosis, spasticity, and wasting syndrome. Continuous research and standardization of products for medicinal purposes are expected to increase the popularity, as well as demand for cannabis in the future.
North America Dominates the Market
The North American cannabis industry is set to become the major producer of cannabis after the legalization of cannabis in Canada. In October 2018, Canada legalized the use of marijuana for recreational purposes nationwide.
In December 2018, the United States government approved the farm bill, making cannabis containing less than 0.3% THC legal in the country. Similarly, some of its derivative compounds have been approved by the Food and Drug Administration for medicinal use. Marinol, Syndros, Cesamet, and Epidolex are the cannabinoid drugs that received approval from the FDA in the country. Furthermore, in the United States, ten states have legalized cannabis for recreational use and on other hand, 33 states and the District of Columbia have legalized cannabis for medical purposes. Among these states, California, Washington, and Colorado are the top-selling cannabis products. the production levels of cannabis in North America have increased rapidly over the past few years owing to the expansion of the production capacities by the major players.
The Global Cannabis Market is an extremely fragmented market with local and regional players occupying a major share in the market. In the cannabis market, companies are very active and are constantly involved in acquiring shares and developing new products to attract a larger portion of consumers toward their products. For instance, in January 2019, Canopy Growth Expanded Beverage Portfolio with the launch of the first CBD-Infused Beverage Line Quatreau.
Companies in the United States and Canada are focusing more on acquiring licenses for the production and trade of cannabis-based products. They are also involved in the development of food products containing cannabis, which is the preferred mode of consumption by the consumers.
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