Overview of the International Cannabis Market

Latest analysis conducted by New Frontier reveals the full scale of cannabis demand worldwide. Insights reveal that more than 260 million adults globally consume cannabis at least once a year, for a total collective expenditure of $344 billion USD.

The cannabis market size varies significantly by geographical region: social and cultural “rules” have a major influence on the use of cannabis, and each region’s market is heavily dependent on demographics, population, average cannabis prices paid for in each region and rates of usage.

Asia is the largest market worldwide, due to its geographical size, counting for 39% of cannabis consumers. It is home to almost 60% of the population, yet Asia has the lowest regional usage rate (2%). On the other hand, Europe (12%), North America (15%) and Africa (11%) have higher percentages of active adult consumers.

North America is currently spearheading in cannabis use and social acceptance, with 25% of worldwide demand, despite having only 5% of the global population. Reference

The United Nations estimate that approximately 190 million people, or 3.9% of the population worldwide, use cannabis (as opposed to 1 billion smokers). The highest predominance of marijuana users is from Europe, US and Oceania. Despite its small size, the Oceania Region is considered to be of high strategic importance, due to its easy access to the Asia Pacific Region. Reference

According to a new report released by Grand View Research, Inc. the legal cannabis market size is expected to reach USD 66.3 billion by the end of 2025 worldwide, anticipated to expand at a CAGR of 23.9%. The growth will be promoted by increasing legalization of both medicinal and recreational applications.

Increase use of cannabis as a medical treatment for medical conditions such as Parkinson’s disease, cancer, arthritis, Alzheimer’s disease, and other neurological conditions is anticipated to increase demand for medical marijuana in the forthcoming years. Growing need for pain management therapies to alleviate chronic pain among elders is also anticipated to boost demand.

Thanks to the legalization of medical cannabis and changes of legislation to decriminalize it, there has been a significant decrease in the black market, as people are resorting to legally purchased products for medicinal and recreational purposes. In addition, countries that have decriminalized cannabis are seeing an exponential increase of earnings through taxation. The large population of Canada and the US and legalization of cannabis for medicinal purposes is anticipated to propel the demand for cannabis in North America.

However, legalization of medical cannabis in Europe, along with stringent regulations regarding cultivation and product sale can limit the European market growth and, in turn, the global market. Promising markets for cannabis are Uruguay, Australia, Colombia, Poland, Germany, and Israel. Israel is currently at the leading edge for knowledge transfer and provision of technology to the other world markets. Reference

The International Market

Key Global Market Trends

Global market is driven by the increasing legalization of cannabis and medicinal cannabis accounts for the majority shares of the market. Several countries around the world have legalized the usage of medicinal cannabis and, those countries in which it has been legalized, have a large adult population aged 50 and above. This increase the demand for medicinal cannabis as the likelihood of developing chronic diseases increase after 50 years. Countries like Chile and the US have legalized medicinal cannabis, but its sale is illegal in these countries. As a result, cannabis is mostly donated on a non-profit basis and its usage strictly limited in medical practices.

The Market is Dominated by North America

The cannabis market is growing with a CAGR of 37%. Valued at USD 14.5 billion in 2018, the market is projected to reach USD 90 billion by 2024. The growth rate is attributed to the fact that an increasing number of countries around the world are opening up, making significant changes in legislation and legalizing the usage of cannabis for medicinal purposes. More countries are also legalizing the usage of cannabis for recreational purposes. Canada and the US account for more than95% of the cannabis market.

Competitive Global Landscape

Companies are very active in the cannabis market, constantly involved in shares acquisitions and development of new products to increase their market share. In Canada and the US, companies are focusing more on acquiring licences for the manufacture of cannabis based products. In addition, they are getting more and more involved in the development and production of food products containing cannabis, which statistics indicate that this is the preferred method of consumption by the consumers/patients.

Major Global Players

· Canopy Growth Corp.

· GW Pharmaceuticals PLC

· Tilray

· Scotts Miracle-Gro Co.

· Aphria Inc.

· Aurora Cannabis Inc.

Canada has been the greatest beneficiary of the cannabis revolution, leveraging on the advantage of being the first mover nation. Some of Canadian licensed cannabis producers (LCP) can export medicinal cannabis products in the form of oils or flowers to licenced importers in countries like Chile, Australia, Cayman Islands, and Germany.

· Medicinal cannabis held the largest market share in 2018 and is estimated to expand at a CAGR of almost 13% by 2025, due to its increasing usage in treating cancer and other medical conditions

· American legal cannabis market was valued USD 12 billion in 2018 and is expected to expand at a CAGR of 24% from 2019 to 2025.

· North American key players operating in the legal cannabis market include Canopy Growth Corporation; Tilray; Cronos Group; Maricann Group, Inc.; ABcann Medicinals, Inc.; GW Pharmaceuticals, plc.; Organigram Holding, Inc; The Lexaria Corp.; Aphria, Inc.; and Aurora Cannabis.

· Buds segment accounted for a significant market share by product type in 2018 and is anticipated to expand at a CAGR of 21% from 2019 to 2025. Reference

Brands, Brands, Brands!

Retail brands will be where the money is made. And Consumers are already demanding high-quality brands, with research indicating that they show great loyalty to the brand of choice, with OrganicMarijuana.com and MOCA leading the way.