The Global CBD Market: Will It Overtake THC?
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CBD has come a long way since it was taken off the list of schedule 1 drugs a few years ago. It’s available online everywhere and in stores and dispensaries across the nation. It’s not only available in pharmacies like CVS and Walmart, but you can even buy it in stores like Abercrombie & Fitch and American Eagle Outfitters.
There are also far fewer restrictions on growing and distributing CBD. Organically grown CBD from Oregon, for example, is becoming a widespread industry thanks to the integration of USDA regulations that help to monitor hemp growth and improve the final products. Colorado, Washington, Kentucky, and other states are also taking advantage of more lax industrial hemp laws to help turn the CBD market into a multi-billion-dollar industry.
With the rapid growth and excitement around CBD, investors and fans alike are asking: Will CBD become more popular than THC?
The answer to this question depends on who you’re talking to, but most of the evidence points to yes. CBD seems to be growing at an unstoppable rate, and the dollar signs just keep growing.
2018 Began an Upward Swing for CBD Sales
Market research shows that 2018 was the beginning of CBD sales as we know them now. The upward tick occurred even before the Farm Bill was passed at the end of the year, allowing more industrial hemp growth across the nation.
During 2018, there was great political and media awareness of CBD, and that made consumers curious. When the FDA got involved and conducted a hearing on cannabis with more than 100 speakers sharing their opinions, that curiosity only grew. It increased sales just through simple curiosity.
More than 10 percent of all dollars spent in a dispensary were spent on CBD in 2018, according to a BDS Analytics report. This was up 3 points from the previous year, a monumental growth in the industry.
This was also the year that the creativity in the market started to explode. We went from having inhalable CBD and sublingual oil tinctures to having gummies, capsules, gel capsules, chocolates, coffees, and so much more.
CBD to Be a $20 Billion+ Industry
Multiple reports show that the CBD industry is slated to reach upwards of $20 billion within the next four years. BDS Analytics believes it will be worth $20 billion by 2024, which is 10 times what it was worth in 2018. Rolling Stone published a report recently stating that it would be a $22 billion industry, and other reports believe it will be worth even more
Currently, the cannabis industry as a whole is worth about $52 billion with an anticipated growth rate of 18 percent. That means that CBD amounts to nearly half of all cannabis sales, and it could overtake current THC sales faster than you might think.
“This was up 3 points from the previous year, a monumental growth in the industry.”
Overall Consumers Seem to Prefer CBD
When compared to the sales of CBD, THC seems to be far less popular than CBD. This could be because of the legal issues surrounding THC in certain states, but it’s more likely because CBD offers many of the benefits of marijuana without getting users high. For some, getting high is a nice perk, but for most, it’s very inconvenient to be high all the time in order to get the health benefits of the cannabis plant.
CBD as an alternative form of medicine is very enticing to consumers. There are boundless claims to what CBD can do, and while we’re getting more research to play out the roles of CBD in human physical and mental health, the facts are still a little fuzzy on all CBD can do.But many consumers aren’t interested in the scientific facts about CBD. Rather, they like to hear what others are saying and how they feel with the substance in their systems. So far, the most common praises of the best CBD oil involve relief from the following ailments:
- Anxiety
- Pain
- Inflammation
- Depression
- Epilepsy/seizures
- Neuroprotection
- Skin conditions
- Overall health protection
- Addiction recovery
- Cancer symptoms treatment
These claims are not groundless. We do have plenty of research on animals and some human trials that show positive results in these areas, and that’s enough for many consumers. They continuing buying CBD, whether or not it has a placebo or real effect on their systems. And these results are the reason why CBD has become so popular. Many people look for the best CBD balms, oils and other related products.
The FDA’s Involvement Will Play a Large Roll
Analytical reports on the state of CBD show that the FDA will be getting more involved in the future, and that could be a game changer for CBD. The FDA has been holding hearings and sponsoring research over the last couple of years to evaluate how best to get involved in the CBD market.
The outcome of the FDA’s findings will be huge for the CBD market as a whole. If they deem CBD a useful medication and start regulating it like they do any other drug, the sales of CBD will skyrocket. Not only will consumers be more apt to purchase the products, but doctors will begin suggesting CBD to more patients.
Big pharma will start buying up CBD and industrial hemp farms, laying out the groundwork for endless research on the product. They’ll develop medications and likely sell them at high price points, massively driving up the numbers for the CBD market. THC has played a role in pharmaceutical research, but the restrictions make it difficult for it to go mainstream, another way that CBD and THC markets differ.
If the FDA determines that CBD should not be part of their federal regulations and that it’s more of a supplement, CBD sales will likely continue to grow at the same rate. Things will continue as usual.
But if the government group decides that it’s harmful and starts marketing it as such, sales will no doubt plummet and CBD companies will be shut down all over the country. Thankfully for CBD users and those invested in the products, the chances of this occurring are very slim.
This list of possibilities simply illustrates how the FDA has a great stake in the future of CBD. Any investors in the industry would do well to monitor the FDA’s stances on CBD during this coming year.
Questions & Answers
Q.Which specific events in 2018 led to an upward swing in CBD sales?
Which specific events in 2018 led to an upward swing in CBD sales?
Increased political and media awareness made consumers curious, and this grew further when the FDA conducted a hearing on cannabis with over 100 speakers. These factors collectively increased sales through simple curiosity.
Q.What is the primary reason why consumers seem to prefer CBD over THC?
What is the primary reason why consumers seem to prefer CBD over THC?
Consumers primarily prefer CBD because it offers many of the benefits of the cannabis plant without causing the 'high' associated with THC. For many, getting high is inconvenient, even for health benefits.
Q.How could the FDA's future involvement significantly impact the CBD market?
How could the FDA's future involvement significantly impact the CBD market?
If the FDA deems CBD a useful medication and regulates it like other drugs, sales could skyrocket as doctors suggest it and big pharma conducts research. Conversely, deeming it harmful would cause sales to plummet.
Q.What was the estimated value of the CBD market in 2018, and what is its projected value?
What was the estimated value of the CBD market in 2018, and what is its projected value?
In 2018, the CBD market was worth approximately $2 billion. Multiple reports now project it will reach upwards of $20 billion, with some suggesting $22 billion or more, within the next four years.
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