The cannabis industry has undergone a sea of change in terms of liberalization, normalization, globalization, and commercialization. Two themes fuel the expansion of legal cannabis globally – increasing acceptance of the plant’s therapeutic properties and the recognition of the cannabis industry as a means for economic growth.
In December 2020, the United Nations took a major step and voted to reschedule cannabis policies and asked the World Health Organization to remove CBD from the list of narcotic drugs. This is an important step as it helps remove the negative stigma toward cannabis. Despite it still being illegal in many countries, self-reporting usage is slowly but surely rising.
Factors and Stats of Cannabis Usage
COVID-19 increased the use of cannabis in the US as more and more people were suffering from stress and anxiety. Not being able to go out to social gatherings also increased the usage of CBD and THC. North America is still at the epicenter of the global cannabis manufacturing economy, as it is responsible for 97% of the sales in 2020.
Other factors behind the growing cannabis production and demand stem from the rapidly evolving and diverse line of products. Consumers today demand a vast array of cannabis consumption methods and are not simply limited to inhalation. Confectioneries and edibles are becoming the more desired option for consumption. These infused alternatives offer a more euphoric and enjoyable experience to recreational users. This newfound likeness towards alternative consumption methods is fueling cannabis companies to look for new production solutions.
This newfound likeness towards alternative consumption methods is fueling cannabis companies to look for new production solutions.
They also offer an easier consumption method for users that consume cannabis for medicinal purposes. Some of the most popular edible items in the market include chocolates, candies, and beverages. More than 25 states in the US have already opted to change their policies to facilitate the safe and legal use of cannabis for medicinal purposes.
Legal Cannabis Industry Destined for Growth
As the pandemic restrictions ease, the legal market for cannabis is beginning to open doors for cannabis consumers. The forecast for global cannabis sales expects the last recorded revenue of $21.3 billion in 2020 to increase to $55.9 billion in 2025. This prediction comes from the cannabis industry research firm BDSA.
In the US, the market segment which will likely lead the cannabis market includes adults. This will emerge as a by-product of the recreation cannabis programs that states will slowly begin to launch. In 2021, New Mexico, New York, and Virginia approved a policy that allows the use of cannabis for adults.
Furthermore, policymakers are making efforts to formulate laws that govern the recreational use of cannabis in the states of Connecticut, Delaware, and Maryland amongst others. Despite not being highlighted, the medical cannabis industry is also shining with great potential.
Sales of Cannabis Edibles and Growth
Eaze is marijuana delivery service that conducted a State of Cannabis Report in 2020. According to this report, edibles did not only lead the cannabis market but were also the top category in most major markets. This shift towards edibles is a response to the respiratory concerns which were significant during the pandemic. This made the population turn towards edibles since inhalation greatly stresses the lungs.
Another segment of the cannabis product line which is grabbing attention takes shape in the form of concentrates. The sale of concentrates increased by 40% in California, Colorado, Nevada, Oregon, and Washington. On the other hand, CBD sales are somewhat cooling down. According to a report by the Nutrition Business Journal, the sale of CBD products dropped by 2%. However, the publication expects a jump in growth by 16%.
Future of FDA Regulations for Cannabis
The regulation of cannabis is taking quite some time to come to fruition. Despite the tough litigation procedures that come with cannabis litigation, you can still find some glimpses of hope. For instance, you can see good news coming from Virginia, as their senate has passed a bill that launched adult-use sales in September.
Even though this bill legalized adult use, it still limits licenses for cannabis enterprises. Companies in the cannabis industry need to prepare for any unwanted policy change that disrupts routine business processes. Having a certified confectionery partner in this instance can be pivotal for companies when they are navigating across all FDA guidelines and restrictions.
Overview and Federal Legalization
Overall, the US legal cannabis industry is expected to grow to 31 billion dollars in 2022. This is a 28% growth, with about 18 states allowing recreational use. Federal legalization of the cannabis manufacturing industry will spike a major change in the industry.
Nonetheless, the ease in regulations across different states is a positive. Regardless of the US federal policy not being supportive, opportunities for US operators still exist in the market as states like New York, New Jersey, and Connecticut all legalized cannabis.
The FDA’s goal is to protect consumers from using a product that will impact their health. However, it is important to note that FDA is not the sole entity regulating cannabis policies. Instead, other federal agencies also have a part to play when it comes to cannabis products. Up until now, the FDA allows four classes of cannabis products in the USA.
There are no new FDA rules to watch out for in the future, and according to recent trends, good scientific finds will eventually lead to positive changes in cannabis laws for both the producer and the consumer.