Global cannabidiol market is projected to witness a CAGR of 18% during the forecast period 2024–2031, growing from USD 8.04 billion in 2023 to USD 30.22 billion in 2031. The market has experienced significant growth in recent years and is expected to maintain a strong pace of expansion in the coming years.
Growth in the global cannabidiol market is being driven by various factors such as increased medicinal application of CBD in the healthcare industry and increased research and development by leading players to study the potential benefits of CBD in different medical conditions. Growing acceptance among people regarding the safe usage of CBD for health conditions such as epilepsy is leading to the growth of this market globally. Increased legalization of CBD across different countries is enhancing the interest of public and private organizations in investing in the cannabidiol market. The presence of several top players, new companies, and collaborative ventures such as mergers and acquisitions, partnerships, distribution agreements, and frequent new product launches are driving the growth of the global cannabidiol market.
The global cannabidiol market is undergoing significant growth due to the increasing application of CBD for medicinal purposes such as anxiety, depression, chronic pain, and epilepsy. CBD is widely used by the pharmaceutical industry as CBD oils, capsules, and topical creams, due to its huge potential in providing therapeutical advantages. As a result, several public and private organizations are increasingly investing in research and development activities to find out more therapeutical benefits of CBD. Over the years, there has been an increased acceptance of CBD usage for medicinal purposes among patients and healthcare providers, leading to a growing demand for the CBD market.
A favorable regulatory framework plays a crucial role in enhancing the global CBD market. There has been increased legalization of the usage of CBD for medicinal purposes across different countries. The act is enhancing and expanding the CBD market at a global level. Moreover, frequent collaboration activities such as mergers and acquisitions, partnership agreements between the companies, consistent innovative product launches by the key market players, along with new entrances, further propels the global cannabidiol market. In December 2023, Rare Cannabinoid Company announced the launch of THC + THCV Uplift Gummies. This product has been launched for the United States consumers to increase focus, energy, and control hunger.
Increasing Prevalence of Mental Health Problems
There has been a surge in demand for cannabidiol due to the rising number of mental illnesses such as anxiety and depression among the global population. Mental health conditions are not uncommon these days and affect a larger section of people from all over the world. The World Health Organization states that mental disorders such as depression have become a common health condition in today’s life. Globally, around 3.8% of the population is affected by depression, includes 5% of adults and 5.7% of people aged 60 years and above.
WHO states that, globally, there are around 280 million people who suffer from depression. Depression is more common among women compared to men. Globally, 10% of pregnant and post-partum women experience depression every year. WHO states that every year more than 700,000 people die due to suicide. Several studies have shown the potential of CBD in managing depression and anxiety, which has substantially led to improvement in the health condition of the people. Hence, many organizations are incorporating CBD for developing CBD-based products.
Favorable Regulatory Framework
With the growing demand for CBD-based products, there has been consideration within the regulatory bodies such as FDA, to improve and bring new regulatory pathways to support the ethical and safe use of CBD-based products in the healthcare industry. In January 2023, the Food and Drug Administration in the United States announced that it is now re-evaluating the regulatory framework for goods containing cannabidiol. The FDA has determined that the current regulatory frameworks for foods and supplements do not apply to CBD and that a new regulatory approach is required to initiate a compromise between the requirement for consumer safety and people’s desire to have access to CBD products. To create a new cross-agency approach to the regulation of these items, the FDA is ready to collaborate with Congress. This favorable change in the current regulatory systems is expected to accelerate the development of cannabidiol.
Consumption of CBD Oil is Witnessing Significant Demand
Among the form segments, CBD oil segment holds a significant market share in the global cannabidiol market. In comparison with other forms of cannabidiol, CBD oil has vast application areas such as in pain management, epilepsy, nutraceuticals and beauty. CBD oils are legal and easy to access, which makes it highly popular among manufacturers and consumers. Additionally, several leading players are launching CBD oils for various medical purposes in their product portfolio, which is enhancing the growth of the global cannabidiol market. For instance, in September 2023, Aurora Cannabis Inc., a Canada based medical cannabis company announced an expansion of its hemp-derived CBD portfolio in Brazil. The company is all set to launch full-spectrum, single-source 3% CBD oil, to cater to the need of the consumers in Brazil.
Application of CBD in Treating Epilepsy
Among the therapeutic application segment, CBD is widely used for the treatment of epilepsy and thus, the segment holds a significant market share in the overall global cannabidiol market. Cannabidiol has shown promising positive effects in the treatment of epilepsy, especially in certain epileptic syndromes such as Lennox-Gastaut syndrome and Dravet syndrome. Regulatory bodies such as the European Medicines Agency and the U.S. Food and Drug Administration have approved CBD for use in certain epilepsy treatments.
Moreover, key market players are bringing new product launches in this segment to improve the health conditions of the patients, which is further accelerating the growth of the segment. In January 2023, Medical Marijuana, Inc. subsidiary “HempMeds Brasil” successfully launched two new CBD-based products in Brazil to help in the treatment process of epilepsy. HempMeds Brasil is authorized to provide its CBD-based products, under medical prescription to aid in the management of diseases such as epilepsy, Parkinson’s, chronic pain, and multiple sclerosis.
North America Dominates Global Cannabidiol Market
North America holds the largest share in global cannabidiol market, due to various factors such as the presence of major manufacturers including Medical Marijuana Inc. and Tilray Inc., increased acceptance among healthcare providers and people regarding using CBD-based products for medical conditions such as anxiety, depression, epilepsy, and pain management driving high demand for cannabidiol. Additionally, favorable laws regarding the usage of CBD products in most of the countries in North America are enhancing the growth of the market.
Medical Marijuana Inc., stated that in the United States, there are around 33 states, that have legalized safe usage of marijuana and there are more states that are expected to receive permission to legalize cannabinoid usage in the future. Consequently, along with the re-formation of federal law, it is expected that North America will further undergo tremendous growth in the cannabidiol market and will maintain its leadership in the forecast period as well.
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Future Market Scenario (2024–2031F)
The global cannabidiol market is expected to grow in the future due to multiple factors. The increasing prevalence of anxiety and depression among the population has enhanced the company’s focus in developing CBD-based products that can help with relieving mental stress among the users. Increased acceptance among healthcare providers regarding the capabilities of CBD in the treatment of anxiety, depression, and epilepsy has enabled pharmaceutical companies to increase investments in the market. There has been a surge in research and development activities in the market to further explore the potential benefits of CBD in patient treatments. Collaborative ventures among the companies, improved and supportive regulatory framework, and new entrants have spurred growth in the global cannabidiol market. According to an article published in the “Hartford Business Journal” many CBD companies are planning to start their operations in 2023 and 2024. Along with it, new retailers, manufacturers, and products are expected to enter the cannabidiol market, which will further assist in driving the market growth.
Understanding Cannabidiol:
Cannabidiol is a naturally occurring compound found in the cannabis plant. Unlike its cousin, tetrahydrocannabinol (THC), CBD is non-psychoactive, meaning it doesn’t produce the “high” typically associated with cannabis use. Instead, CBD is celebrated for its potential therapeutic properties, including anti-inflammatory, analgesic, and anxiolytic effects.
Market Dynamics:
The global CBD market has witnessed remarkable growth in recent years, and several factors contribute to this phenomenon:
- Changing Legal Landscape: As countries around the world reconsider their stance on cannabis, many have legalized or decriminalized the use of CBD. This has opened up new avenues for market growth and encouraged investment in research and development.
- Increasing Consumer Awareness: Public awareness of the potential health benefits of CBD has surged. Consumers are seeking natural alternatives for various health and wellness concerns, such as anxiety, pain management, and sleep disorders, driving the demand for CBD-infused products.
- Diversification of Products: The CBD market is no longer confined to traditional forms like tinctures and capsules. It has expanded into a myriad of products, including edibles, beverages, skincare, and even pet products. This diversification appeals to a broader consumer base.
- Strategic Partnerships and Investments: Major players in the pharmaceutical, food and beverage, and wellness industries are recognizing the potential of the CBD market. This has led to strategic partnerships, mergers, and acquisitions, further propelling the industry forward.
Regional Insights:
The growth of the global CBD market is not uniform across regions. North America has been a frontrunner, driven by the legalization of cannabis in several U.S. states and Canada. Europe is also witnessing significant growth, with countries like the United Kingdom, Germany, and Switzerland embracing CBD products. Asia-Pacific is emerging as a potential market, albeit with varying degrees of regulatory acceptance.
Challenges and Future Prospects:
Despite the promising outlook, the CBD market faces challenges, including regulatory uncertainties, quality control issues, and the need for standardized testing. As the industry matures, stakeholders are working towards establishing clear regulations and industry standards to ensure consumer safety and product efficacy.
Looking ahead, the global CBD market is poised for continued expansion. The integration of CBD into mainstream consumer products, ongoing research into its therapeutic potential, and evolving regulatory frameworks will shape the trajectory of this flourishing industry. As businesses navigate this dynamic landscape, the key to success lies in innovation, quality assurance, and responsible marketing practices.
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