CBD Market Projections
Unlike many CBD companies and other CBD companies and especially and specifically those CBD companies targeting veterans for pain on television and radio, only VETERAN DEFENSE CBD “based products are grown, produced, inspected by US inspectors throughout the manufacturing, and packaging of our CBD products. Our hemp is grown in Colorado and our manufacturing and packaging is done in Kansas and soon in Missouri. All our bottles and packaging are sanitized and inspected in the USA by VETERANS and DISABLED VETERANS so they can live the “AMERICAN DREAM” and again our hemp products are not grown overseas, nor produced or manufactured overseas in unregulated markets.
Out of all cannabinoids, cannabidiol is most widely used for therapeutic reasons due to the lack of psychoactive effects. In many medical applications, cannabidiol oil is used, such as anxiety and depression treatment, stress relief, diabetes prevention, pain relief, cancer symptom relief, and inflammation. Due to the increasing adoption of CBD-based products to treat ailments, the global cannabidiol market is anticipated to grow at a lucrative rate over the forecast period.
Increasing awareness of cannabidiol's therapeutic benefits has influenced a buyer to buy cannabidiol products, regardless of their cost. As these have a greater profit margin, commercial retailers are now focusing on selling cannabis-based products. Numerous health and wellness retailers are offering CBD-based products, such as Rite Aid, CVS Health, and Walgreens Boots Alliance. In addition, CVS Health decides to offer CBD topicals all over its 800 stores and Walgreens Boots Alliance is selling CBD-containing topicals across 1500 of its stores in the U.S.
However, the COVID-19 pandemic has caused unprecedented lockdowns all around the world, collapsing daily operations and changing consumer behaviors in nearly every industry. As the response to COVID-19 ramps up, retail stores have shut down. The market started experiencing a shortage in supply due to the nationwide shutdown of transportation and manufacturing in major raw material manufacturing countries, such as China and India. In addition, due to supply chain disruptions in the U.S., the supply of other raw materials has been limited, which is disrupting the manufacturing, and in turn, the supply chain of CBD consumer health products.
|
Pandemic Impact |
Post COVID Outlook |
|
The cannabidiol market declined by 6.1% from 2019 to 2020 |
The market is estimated to witness a y-o-y growth of approximately 20% to 23% in the next 5 years |
|
The market started experiencing a shortage in supply due to the nationwide shutdown of transportation and manufacturing in major raw material manufacturing countries, such as China and India. |
Hemp-derived CBD is expected to grow at a CAGR of 23.4% post-pandemic owing to increasing demand from the pharmaceutical sector and rising awareness among consumers regarding health. |
|
As the response to COVID-19 ramps up, retail stores have shut down, thereby impacting the sales of CBD products. Disruptions in the supply chain have led to limitations on the supply of other raw materials, hampering growth. |
Companies are entering into multiple partnerships and launching innovative products for increasing their distribution networks and expanding their consumer base. |
On the other hand, the existence of strict regulations and the high cost of cannabidiol products are some of the major factors limiting the growth of the market. In addition, the absence of legalization initiatives in many Asian and African countries is another main factor impeding the market growth.
Source Type Insights
The hemp segment dominated the market and accounted for the largest revenue share of 59.6% in 2020. The increasing acceptance of refined CBD products combined with the increasing legalization of marijuana and marijuana-derived products for various medical applications is driving the growth of this segment. In addition, the high effectiveness of cannabidiol extracted from marijuana is a key factor for the large share of the market.
Cannabidiol derived from hemp is anticipated to witness rapid growth owing to increasing demand from the pharmaceutical sector and rising awareness among consumers regarding health. Increasing consumer disposable income along with the legalization of medicinal cannabis is anticipated to have a positive impact on the demand for cannabidiol in the pharmaceutical sector. Oils, tinctures, concentrate, capsules, topical solutions such as slaves, lip balms, lotions, and edibles such as baked goods, coffee, chocolates, gums, and candies are some of the CBD products which are in high demand.
Furthermore, the use of hemp-derived CBD is increasing rapidly owing to its anti-inflammatory, anti-aging, and antioxidant properties. Various industries such as pharmaceuticals, personal care and cosmetics, nutraceuticals, and food and beverages are developing CBD-derived products for health and wellness purposes. Therefore, the above-mentioned factors would be responsible for this segment's fastest growth rate over the forecast period.
Distribution Channel Insights
The Business to Business (B2B) segment dominated the market and accounted for the largest revenue share of 58.9% in 2020. The segment is expected to expand at a lucrative rate over the forecast period. This can be attributed to an increase in the number of bulk or wholesale CBD oil providers, as well as an increase in demand for CBD oil as a raw material. Similarly, after the legalization of CBD products in various countries, the avenues for supplying these products significantly increased, due to the expanding consumer pool.
The hospital pharmacies sub-segment accounted for the significant revenue share in 2020, owing to the increase in the number of companies establishing exclusive collaborations with retail pharmacies to increase their visibility and create an independent entity for customers to purchase CBD products. Furthermore, the CBD market is expected to present significant opportunities for market participants, owing to a surge in stockpiling events by pharmacies, exclusive collaborations of companies with retail pharmacies, and an increase in the number of patients opting for CBD treatment.
End-use Insights
The pharmaceuticals segment dominated the Cannabidiol (CBD) market and accounted for the highest revenue share of 42.8% in 2020. The segment is anticipated to grow at a lucrative rate over the forecast period. The large share has been attributed to factors such as the increasing number of ongoing trials to study the impact of CBD on certain health conditions is anticipated to drive the demand in the forthcoming years. Furthermore, many companies acquire CBD oils in bulk and manufacture CBD-infused products. These products are used by a large consumer base as a pain and stress management alternative. Thus, most of these products are depicted to be in the growth phase of the market.
The pharmaceutical segment is projected to witness the fastest growth rate over the forecast period. This rapidly progressing transformation of cannabidiol from herbal preparations to prescription drugs is anticipated to boost the growth of the market. Furthermore, growing awareness about the medical benefits of cannabidiol, including its healing properties, is anticipated to drive the product demand in the pharmaceutical industry.
Regional Insights
In 2020, North America dominated the market with a revenue share of 37.3% and will continue to retain its leading position in the market. The presence of large health-conscious people in the region, growing acceptance for CBD-based products, the presence of major manufacturers, and approval of the U.S. Farm Bill in 2020 are some of the major factors driving the growth of the region. North America is known to be the most progressive region for cannabis and its products, including cannabidiol. It has the highest number of CBD companies and lenient laws regarding the utilization of CBD products.
In Asia Pacific, the market is anticipated to witness the fastest growth over the forecast period owing to the setup of hemp-producing plants, especially in China. China is the largest hemp cultivator in Asia, producing nearly half of the world’s hemp. The country exports around 90% of its products to the U.S., Germany, the U.K., the Netherlands, and Japan and has started cultivating hemp in three provinces for cannabidiol extraction purposes. The newfound government policies supporting the industry, lowest cannabidiol production costs, and unique large-scale manufacturing infrastructure and expertise are expected to create fierce competition for the U.S., Canadian, and European Union hemp companies with low-cost CBD supply.
Key Companies & Market Share Insights
Products in the market provide users the health benefit of cannabidiol without intoxication. Hence, they are gaining traction within a short time. Moreover, competition in the global market is high because companies are focused on increasing their product offerings, entering new markets, and gaining new consumers.
The market is very fragmented due to the presence of a large number of players. Various companies are launching innovative products and expanding their presence in different geographies to sustain their position in the market. Moreover, companies are entering into multiple partnerships for increasing their distribution networks and expanding their consumer base. This competition is expected to intensify over the forecast period, as the adoption of CBD-infused products is increasing worldwide.