The global cannabis extraction market, valued at USD 2,582.4 million in 2021, is poised for robust growth, with a projected compound annual growth rate (CAGR) of 20.3% during the forecast period. This unprecedented growth is driven by various factors that underscore the increasing demand for cannabis extracts and the expanding legalization of marijuana for treating chronic conditions.
Rising Demand for Medicinal Cannabis Drives Market Expansion
As the awareness of the medical benefits of cannabis continues to grow, the market for cannabis extracts, including oils and tinctures, is witnessing a surge in demand. These extracts are not only used for smoking but are also essential in the production of topical and edible products, making them a preferred choice for patients seeking alternative treatments for conditions such as cancer, arthritis, Alzheimers disease, and anxiety.
Reduced Illegal Market and Favorable Regulations
In regions where marijuana has been decriminalized and legalized for medical purposes, the legal purchase of medicinal cannabis has led to a significant decline in the illegal market. Cannabis extracts, especially tinctures and oils, are subject to more lenient regulations compared to dried buds, further fueling the industrys growth.
Rising Incidence of Chronic Diseases and Mental Health Challenges
With the increasing prevalence of chronic diseases such as cancer, diabetes, and others, the demand for cannabis extracts as a potential treatment option is on the rise. Furthermore, the World Health Organization (WHO) estimates that approximately 2.5% of the global population consumes cannabis annually, driving the demand for CBD extracts. Moreover, the widespread occurrence of depression, affecting approximately 5% of adults globally, highlights the potential for cannabis extracts to address mental health challenges.
COVID-19 Impact on Cannabis Consumption Rates
The COVID-19 pandemic significantly influenced cannabis consumption rates worldwide. Many individuals turned to cannabis to alleviate stress and anxiety during the pandemic, with approximately half of cannabis users in the United States reporting its use for this purpose. The pandemics impact led to higher-than-expected rates of cannabis use, with retail cannabis sales in the United States projected to increase by 35% in 2020 compared to previous forecasts.
Market Drivers
- Legalization Spurs Growth: The increasing legalization of cannabis for both medical and recreational use in various countries, including South Korea, Colombia, the United States, and more, is a key driver of market expansion.
- Medicinal Benefits: The medicinal benefits of cannabis extracts, including their effectiveness in reducing stress, anxiety, and sleep disorders, are propelling market growth.
Market Restraints
- Stringent Regulations: Strict regulatory frameworks in emerging economies and fluctuating costs of cannabidiol (CBD) products pose significant challenges to market growth.
Segment Overview
- Oil Segment Dominates: In 2021, the oil segment accounted for the highest revenue share at 63.0%, driven by the growing acceptance of cannabis derivatives and their use in treating various conditions.
- Marijuana Category: With an 84.2% revenue share in 2021, the marijuana category is expected to grow at the fastest CAGR. Marijuanas medicinal value, especially in pain relief and mental health treatment, contributes to its market dominance.
Regional Landscape
- North America Leads: North America held a substantial revenue share of 78.9% in 2021, primarily due to the widespread acceptance of cannabis usage for therapeutic purposes, with approximately 57.0% of American adults supporting its use.
- European Market: In Europe, cannabis has found applications in the pharmaceutical industry, especially in countries like Spain, the U.K., and Germany. However, stringent regulations in Europe may hamper overall market growth.
Competitive Landscape
Key players in the global cannabis extraction market include Canopy Growth Corporation, Aurora Cannabis Inc., Tikun Olam, Aphria Inc., Maricann Group Inc., Tilray Inc., and many others. Recent product introductions, such as edible THC products and CBD-infused beverages, exemplify the industrys innovative spirit and growth potential.
The global cannabis extraction market is on a trajectory of remarkable growth, fueled by increasing legalization, the recognition of medicinal benefits, and changing consumer preferences. As the market continues to evolve, key players are expected to drive innovation, contributing to the sectors sustained expansion.
Global Industry Analysis, Size, Share, Growth, Trends, and Forecast 2023-2030 By Product, Technology, Grade, Application, End-user, Region: (North America, Europe, Asia Pacific, Latin America and Middle East and Africa) https://www.fairfieldmarketresearch.com/report/cannabis-extraction-market
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COMTEX_442645536/2840/2023-10-30T06:12:54