The Year Ahead – The Cannabis Industry in 2021.
Cannabinoid beverages are a hot topic, drawing considerable attention from both existing legal cannabis players and participants in the broader consumer packaged goods markets. Total spending on legal cannabis in the United States is set to more than double to $34.5 billion by 2025—and the edibles product category, including beverages, is outpacing that rise considerably. In Canada, where edibles just made their debut late last year, the category is growing much faster than the overall market, which is forecast to reach $6.1 billion in 2025.
Cannabis edibles are a key driver of legal cannabis sales, accounting for 15% of total spending at present. That share is forecast to increase over time: By 2025, sales of edibles are expected to grow to 2.4 times 2020 sales volume versus 2.1 times growth in the total legal cannabis market—where sales are forecast to expand from $16.2 billion in 2020 to $34.5 billion in 2025.
Cannabis vapes had been the fastest growing product category in legal markets until late 2019, with total monthly sales across Arizona, California, Colorado, Nevada and Oregon growing from $64 million in January 2018 to almost $160 million by August 2019.
Acceptance of legal cannabis is rising across the United States and the 2020 election season was an eventful one for the cannabis legalization movement.
Sales of products containing cannabidiol (CBD) have been brisk over the past two years, pacing rising consumer awareness of the substance and greater availability of hemp-derived CBD products beyond the regulated dispensary channel. This robust but fledgling market holds opportunities for companies already in the cannabis space, consumer packaged goods companies and makers of pharmaceuticals.
With launch of Retail Sales Tracking, BDSA Provides Comprehensive Suite of Market and Consumer Insights on the Canadian Cannabis Market
BDSA has launched retail sales tracking data for Canada, providing brands and retailers with greater insight into the world’s largest nationally legal cannabis market.
BDSA forecasts Canada’s cannabis industry will reach CAD$3.3 billion ($2.5 billion) in spending in 2020 and grow to CAD$8.1 billion in 2025, rising at a compound annual growth rate of 20%. Canada’s market is divided into the medical and adult-use channels, with the latter commencing sales in October 2018. Consumer spending in the adult-use channel has grown rapidly since launch and is expected to account for nearly 84% of Canada’s total legal cannabis market in 2020.
43% of alcohol consumers also consume cannabis
An interesting interaction is evolving between beverage alcohol and cannabinoid products that is becoming an increasingly important issue for both alcohol and cannabis brands and retailers to watch as worldwide cannabis consumption grows. Growing acceptance and consumption of cannabis, consumption of both alcohol and cannabis and cannabis product innovation are three factors influencing beverage alcohol consumption.
Infused gummies make up 84% of candy ingestible sales in 2020
While sales of ingestible cannabis have grown steadily in legal markets, candies have seen particularly strong sales, with infused gummies making up 84% of candy ingestible sales so far in 2020 across Arizona, California, Colorado, Nevada and Oregon. Overall gummy sales in these 5 states have seen strong growth in recent years, from $20 million in July 2017 to almost $64 million in July 2020, a growth rate that far exceeds that of other candy ingestibles. The familiar form factor and multitude of flavors that gummy products present make them especially appealing to consumers, who report that the product type is their favorite type of ingestible cannabis.