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Cannabis extract refers to the concentrated cannabis that contains compounds like CBD and THC, which are extracted from the cannabis plant. Cannabis extract products offer several therapeutic benefits for treating conditions like chronic pain, epilepsy, Parkinson’s disease, anxiety, depression and insomnia. Cannabis contains over 100 different cannabinoids like CBD and THC that interact with the endocannabinoid system in the human body to provide therapeutic effects. CBD extract is known for its anti-anxiety, anti-inflammatory properties without any psychoactive effects. THC extract provides analgesic and anti-nausea effects and is used to reduce muscle spasms in patients suffering from multiple sclerosis. The increasing legalization of medical cannabis in various countries and rising awareness about therapeutic benefits of cannabinoids are driving the demand for cannabis extract products.
The global Cannabis Extract Market is estimated to be valued at US$ 10,704.56 million in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market Opportunity:
Growth of CBD-Infused Food & Beverage Industry
The legalization of CBD has opened opportunities for its use in food and beverages as well. CBD-infused foods offer health benefits like reducing anxiety, stress, obesity, cardiovascular diseases etc. CBD extracts are being used in food products like baked goods, chocolates, gummies, coffee, tea, juices and oils. The rising awareness about therapeutic properties of CBD and the convenience of consuming CBD through edibles is driving the demand for CBD-infused foods and beverages. The CBD-infused food & beverage industry is projected to grow at a CAGR of 15% until 2026, thus representing a major growth opportunity for the cannabis extract market players. As people look for alternatives to treat various ailments through dietary changes, the demand for CBD extracts from the food industry is expected to increase significantly during the forecast period.
Porter’s Analysis
Threat of new entrants: The cannabis extract market has significant entry barriers such as high capital requirements and stringent regulations. This makes it difficult for new companies to enter the market.
Bargaining power of buyers: Buyers have moderate bargaining power due to the presence of many established manufacturers. However, stringent quality standards limit options for buyers.
Bargaining power of suppliers: Suppliers have moderate bargaining power due to the specialized nature of raw materials and equipment required. This gives them some control over pricing.
Threat of new substitutes: Threat of substitutes is low as cannabis extracts have unique medical applications that are difficult to substitute.
Competitive rivalry: The market is highly competitive with major corporate players competing on the basis of product quality, reliability, pricing and innovation.
SWOT Analysis
Strength: Cannabis extracts are finding increasing medical applications with strong research ongoing. They provide an alternative to pharmaceutical drugs.
Weakness: Regulatory restrictions and social stigma around cannabis limit the customer base and commercial opportunities for industry players. Long term health effects of cannabis use are still being researched.
Opportunity: Favorable changes in regulations globally are opening new geographic markets. Medical cannabis is gaining acceptance for treatment of various conditions.
Threats: Strict rules around production, sales and transportation increase compliance costs. Oversupply could drive prices down.
Key Takeaways
The global Cannabis Extract Market Scope is estimated to be valued at US$ 10,704.56 million in 2023 and is expected to exhibit a CAGR of 10% over the forecast period 2023 to 2030.
Regional analysis related content: North America dominates the cannabis extract market currently due to legalization and commercial cultivation in Canada and certain US states like Colorado. The Asia Pacific region is expected to witness high growth over the forecast period due to increasing acceptance of medical cannabis across nations like Australia, China and South Korea.
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