The Future of CBD: $20 Billion in Sales by 2024
CBD, or cannabidiol, is one of the many cannabinoids found in the cannabis plant. Unlike THC, which is another psychoactive cannabinoid, CBD does not produce a "high" and has gained popularity due to its therapeutic potential. With the passing of the Farm Bill in 2018, CBD has moved out of the dispensary and become more mainstream, and its growth has been phenomenal since. The CBD market has been on a rapid climb and sales have soared, leading many to predict the future of CBD and where it's headed.
According to a report published by cannabis business intelligence firm, BDS Analytics, in 2019, the global CBD market is projected to reach $20 billion in sales by 2024. This might sound shocking, but as CBD moves further into the mainstream, its market is expected to continue to grow.
CBD in the Dispensary
It's important to keep in mind that CBD didn't just spring up overnight as the Farm Bill was passed. Science has been aware of CBD since the 1940s. However, by 1996, not much was known about CBD, even when California first legalized medical marijuana. As the medical use of marijuana increased, so did the awareness of CBD, and with that increase, more research on both THC and CBD came alongside products featuring either or both cannabinoids in a medical context. By 2013, CBD was officially recognized for its ability to treat seizures, and five years later, the FDA approved the first CBD-derived medication for treating epilepsy. Despite these developments, CBD remained a product confined to medical marijuana dispensaries and, eventually, adult-use recreational dispensaries in states with legal cannabis sales.
CBD in the Mainstream
With $1.9 billion in sales in only the first year of nationwide legalization, there's no denying that CBD has come a long way from its underground days. CBD-infused items like gummies, tinctures, and topicals are the most popular, bringing in over $1.3 billion in sales in 2018. You can find CBD products in health food stores, vitamin shops, and even your local grocery store. CBD's mainstream status is apparent in the customer data on just who is buying CBD. According to BDS Analytics, the average CBD consumer is 43 years old and educated; 40 percent of CBD consumers hold a college degree or higher. They also tend to be gainfully employed with 50 percent of CBD consumers working full time. They don't appear to be a gender gap in the market; 55 percent of CBD consumers are male and 45 percent are female.
The diversity in product categories shows how CBD has become mainstream. In 2018, CBD products were represented in nine major categories with bulk sales falling into wellness and beauty categories. CBD-infused food and beverages as well as pet care products point to potential for growth and product diversity.
The Future of CBD Products
BDS Analytics predicts growth in all CBD product categories, though their share of the CBD market is projected to shift as the market matures. According to their report, by 2024, the wellness and beauty segments of the CBD market will lose some of their dominance, making way for growth in the food, confection, and beverage markets. Meanwhile, the market for CBD flower and vapes will lose ground to more mainstream options. These markets will still grow but make up a smaller percentage of the overall CBD picture. Formal FDA regulation can provide a framework that could support growth in the food and beverage space and inspire greater consumer confidence.
The continued shift to the mainstream will bring with it other changes that will likely impact the market and the way in which it grows. Whatever the future holds for CBD, it's expected to be bright. All indications point to rapid and continued growth across all CBD products and a strong continued push to the mainstream.
In conclusion, the future of CBD looks bright, with its continued rise as a desirable therapeutic option. With increasing consumer awareness, and its potential for use in many more product categories, CBD sales are projected to reach $20 billion by 2024. The potential for growth in the food and beverage space is immense following formal FDA regulation. All these projections point to a robust future for CBD and the products infused with it.