Cannabis Food and Beverages Market

Market Overview

The global cannabis food and beverages market size was valued at USD 0.4 billion in 2022. It is estimated to reach USD 6.94 billion by 2031, growing at a CAGR of 37.3% during the forecast period (2023–2031).

The legalization of recreational or medical cannabis in various countries and the rise in demand for cannabis-based wellness drinks will promote market growth. Hemp is another name for the cannabis plant that is occasionally used. However, it only refers to the strains of cannabis that are grown for purposes other than drug production. Making hemp seeds, oil, fiber, and leaves into juice, vegetables, and even a recreational narcotic has been done for a long time. Cannabinoids come in more than 100 varieties, with tetrahydrocannabinol (THC) and cannabidiol (CBD) being the most widely used. Drinks containing CBD (Cannabidiol) are made from a non-psychoactive component of cannabis that is obtained from hemp and marijuana plants. You can infuse this non-psychoactive substance with non-alcoholic beer, water, coffee, or tea.

CBD may be used to treat mobility and cognition impairments and ease pain and anxiety. Drinks containing CBD also aid in healthy digestion, eliminate toxins, strengthen the immune system, regulate blood pressure, and lower the risk of heart disease. Many people who were previously hesitant to use CBD are becoming interested in its benefits, opening up several new markets for CBD beverages in North America. Beverages with cannabidiol can be found in a variety of product kinds, plant-based options, and other formulations.

Market Dynamics

Global Cannabis Food and Beverages Market Drivers

Legalizing of Recreational or Medical Cannabis in Various Countries

In the majority of countries, the consumption of cannabis for recreational purposes was illegal; however, in recent years, the incorporation of cannabis into products intended for either recreational or medical use has contributed to the expansion of the cannabis market. Because of this, the industry has been experiencing significant expansion over the past few years and is expected to continue. Many nations have legalized cannabis after learning about its health benefits, so the market is expanding substantially.

Furthermore, in light of the current trend toward legalizing cannabis in big nations, smaller nations are projected to legalize cannabis in drinks used for medical or recreational purposes. This development is expected to propel the market during the period covered by the forecast.

Rise in Demand for Cannabis-Based Wellness Drink

High-end products that contain the Cannabis Energy Drink (CBD) component are gaining popularity in both Europe and North America as cannabis continues to be legalized in more places and enter the mainstream market. It is manufactured to deliver to users an immediate surge of energy, a rise in focus, and an increase in alertness throughout the day.

The appealing beverage, an active competitor to the well-known Red Bull Energy Drink, is available in various Flavors such as classic, light, raspberry, and mango. These Flavors make the drink very appealing. Since the last few years, the cannabis market has been growing, and one factor contributing to this expansion is the availability of various tastes in wellness drinks.

Global Cannabis Food and Beverages Market Restraint

Supply Shortage of High-Quality Cannabis in Various Country

Although the usage of cannabis has been legalized or decriminalized in some countries for the manufacture of food and beverages, the drug is still considered illegal in the vast majority of countries throughout the world. Therefore, because of the restriction, its production is limited, leading to a lack of supply in several countries. This is a problem in some different countries.

The conditions of the market and the distribution of demand and supply depend on production from other nations, which is particularly true for rising economies. The illegality of cannabis in many nations is, however, cutting the drug's supply-to-demand ratio, limiting the rise of the market for foods and beverages that include cannabis-infused ingredients.

Global Cannabis Food and Beverages Market Opportunities

Initiative to Legalizing Cannabis-Based Food and Beverages

Cannabis has been demonstrated to benefit human health, leading to an increasing number of nations taking the initiative to legalize cannabis for usage in the food and beverage market. This is because cannabis can be used to make a variety of edibles and beverages. However, in light of the recent legalization of cannabis in Uruguay and Canada, several other countries are taking measures to introduce cannabis into their mainstream markets.

In the past, it was banned in several countries. It is anticipated that the decision that was made to legalize cannabis will result in the establishment of lucrative prospects throughout the period that is covered by the forecast. This is because it is anticipated to make it feasible for additional market participants to enter the field and develop new product lines.

Regional Analysis

Based on region, the global Cannabis Food and Beverages market is bifurcated into North America, Europe, Asia-Pacific, and LAMEA.

North America Dominates the Global Market

North America is the most significant global cannabis food and beverages market shareholder and is estimated to exhibit a CAGR of 26.0% over the forecast period. The global market for foods and drinks infused with cannabis has seen substantial growth due to the cannabis industry's recent decision to authorize its use in the food and beverage industry. As a direct consequence of the recent legalization of cannabis in Canada, many companies are entering the cannabis-infused foods and beverages market. When purchasing edibles and beverages containing cannabis, customers can now access a diverse range of options thanks to the industry's rapid expansion. The growth of the market for foods and drinks infused with cannabis in this region will benefit from the entrance of new firms into the industry.

Europe is anticipated to exhibit a CAGR of 24.8% over the forecast period. The paper largely focuses on the United Kingdom, Germany, the Netherlands, and Switzerland while discussing the cannabis food and beverage sector in Europe. Since these countries are the most developed in the region, they have some of the highest GDPs in the world. As a result, they are taking the lead in the European market and helping boost the European economy. After the prohibition on cannabis was overturned, there was a subsequent surge in the market share of cannabis-infused foods and beverages across the economies of Europe. Since many years ago, the European food and beverage business has been known for being on the cutting edge of culinary innovation. To live up to this reputation, businesses in the European region are constantly developing new products that contain cannabis as an ingredient. The expansion of the market for cannabis-infused foods and drinks in this region is being driven by the introduction of novel cannabis-infused foods and beverages.

In the Asia-Pacific region, in terms of cannabis consumption, the most developed countries are Australia and New Zealand. The research looks at these countries since they are both developing markets and emerging economies; as a result, the report covers them. Because more people are becoming aware of the positive effects that cannabis can have on their health, the market for cannabis-infused foods and beverages in Australia and New Zealand has been expanding.

In addition, expanding the cannabis product portfolio to include a line of wellness and energy drinks has led to a rise in sales of edibles and beverages containing cannabidiol (CBD). In addition, producers are beginning to sell alcoholic beverages in which cannabis is the primary component. Thanks to this initiative, the global market for cannabis-infused foods and beverages is also reaching a significant turning point.

The global cannabis food and beverage industry for the LAMEA area is investigated with a focus on Uruguay, Colombia, and Africa because these nations have the highest cannabis product penetration. As a result of the exceptionally high rate of cannabis production in Uruguay, Colombia, and the rest of South America, the creation rate of foods and beverages containing cannabis is also high. As a result of the rise in cannabis products that can be attributed to farming, manufacturers are now more open to receiving supplies directly from farmers. They are developing more innovative products that come in various appealing flavors. Introducing cannabis products with a wide range of Flavors and aromas is one-factor propelling expansion in the cannabis food and beverage industry in the LAMEA region.

Segmental Analysis

The global cannabis food and beverages market is bifurcated into product, form, application, and end-user.

Based on the product type, the global cannabis food and beverages market is bifurcated into bakery products, chocolate, cereal bars, candy, beverages, ice cream, and others. 

The bakery products segment dominates the global market and is projected to exhibit a CAGR of 27.5% over the forecast period. By baking, baked foods are prepared. Bread is the food that is baked the most frequently, but many other foods are also baked. Bars, bagels, buns, rolls, biscuits, loaf loaves of bread, cookies, and desserts (cakes, cheesecake, pies, muffins, pizza, snack cakes, sweet goods, and tortillas) are additional well-liked bakery products. For millennia, there has been a constant need for bakery goods, and many nations include them in their daily diets.

Including cannabis in bakery goods is the most recent innovation in baked goods. More people are visiting bakeries due to the new inclusion of cannabis in the ingredients used to make bread, cakes, rolls, and buns. During the forecast period, the cannabis food and beverage market is anticipated to be driven by the introducing of more inventive foods made with cannabis in the bakery sector.

Based on distribution channels, the global cannabis food and beverages market is segmented into mass merchandisers, specialty stores, online stores, and others. 

The Specialty Store segment dominates the global market and is predicted to exhibit a CAGR of 26.1% during the forecast period. Customers can access a wider variety of product options when they shop at specialty stores because they carry unique and intriguing goods. Customers seek out specialty stores that sell cannabis-infused foods and beverages to benefit from the recommendations made by the stores' trained employees. The increasing number of wealthy people in developing nations like the United States, Canada, and the United Kingdom is the primary factor propelling growth in the specialty store retail industry. It also makes choosing between products and directly comparing them easier, bringing more customers to specialty businesses.

In addition, customers can experience instant gratification when shopping at specialty stores because the items they purchase there do not require additional waiting time before being carried home. The expansion of the global industry for cannabis food and beverages is being fueled in large part by the proliferation of specialty retailers that provide cannabis-infused foods and beverages.

Recent Developments

• August 2021- Cann, a THC (tetrahydrocannabinol) beverage manufacturer, announced the launch of Passion Peach, a first-of-its-kind cannabis-infused caffeinated social tonic. The manufacturer launched this product line to offer all-natural caffeine with a microdose of THC (tetrahydrocannabinol) to consumers who want alternatives to alcohol.
• November 2021- Molecule Holdings Inc., a Canada-based craft-focused cannabis beverage production company, launched Canajo, the coffee-flavored cannabis beverage. This new product portfolio contains coffee-inspired flavors with an assortment of THC (tetrahydrocannabinol) and CBD (Cannabidiol) levels designed for various cannabis users.