Wednesday 5 June 2019, Amsterdam
According to the new market intelligence report, titled “North America Cannabis Market - Analysis and Forecast, 2019-2025”, the North America cannabis market was valued at $13.21 billion in 2018 and is expected to reach $36.7 billion in 2025. High demand among consumers for safer forms of ingesting cannabis such as tinctures, oils, vapes, and other edibles, coupled with rising investment from both public and private sectors for research and development activities are all together expected to positively reinforce the growth of the market during the forecast period between 2019 and 2025.
Increasing legalization of cannabis in both Canada and U.S. is the most prominent factor contributing to the growth of the North America cannabis market. North America holds the strongest potential among all other regions of the world for the growth of the cannabis industry and offers lucrative opportunities for the entry of new companies into the market. As the countries of North America begin to liberalize laws related to the recreational and medical use of cannabis, more companies are expected to enter into this market in order to address the surging demand for cannabis products. High public and private investments in this sector are further propelling research related to cannabis products, actively driving the growth of the market. However, the market is also witnessing significant challenges that hinders its growth. Although cannabis is legal in the countries of North America for both medical and recreational use, its cultivation, production, distribution, and possession are highly controlled under strict regulations. Moreover, the risk of side effects associated with the use of cannabis hampers its adoption rate, thereby hampering the growth of the market. However, with progressing research activities, safer forms of cannabis products are expected to come up in the market in the upcoming years that offer prospects for the market growth in the years to come. Furthermore, increasing launch of online platforms promoting cannabis products and the paradigm shift toward e-commerce sales of cannabis offer huge opportunities that are expected to drive the growth of the North America cannabis market during the forecast period between 2019 and 2025.
According to Pushplata Patel, a lead analyst “Recreational cannabis contributed to highest market share of the North America cannabis market in 2018 and is also expected to grow at higher CAGR as compared to that of medical cannabis. Stringent regulation controlling the production and distribution of medical cannabis and the risk of negative side effects associated with the medical use of cannabis acted as major restraints limiting the growth of the medical cannabis market in North America. In contrast, upsurge in demand for recreational cannabis aided in the growth of the recreational cannabis market in both the U.S. and Canada.”
- The number of companies operating in this market has increased exponentially over the past few years owning to the huge demand for both medical and recreational cannabis in North America. Synergic strategies involving agreements, partnerships, and collaborations were the most common strategies adopted by the key players of the market in order to sustain in the market competition.
- Several research studies have demonstrated the benefits of cannabis in treating a wide range of medical conditions ranging from pain management to the treatment of cachexia. Among the various medical applications of cannabis, pain management segment contributed to the highest revenue and dominated the market in 2018. High efficiency of cannabis in reducing pain associated with different types of medical conditions, such as cancer, arthritis, cerebral palsy, and muscular dystrophy, aided in the growth of the medical cannabis market pertaining to pain management.
- By distribution channel, retail sales dominated the market in 2018 as it has been the preferred mode of sale of cannabis products among consumers of North America. However, e-commerce sales are expected to witness a much higher CAGR of 22.89% during the forecast period from 2019 and 2025. Increasing launch of online platforms by key companies of the cannabis market promoting e-commerce sales of cannabis is expected to propel the growth of the cannabis market by e-commerce sales.
- In the U.S., the most common cannabis product categories include flower, concentrates, and edibles. Among theses four product categories, flower form of cannabis dominated the cannabis market of U.S. in 2018. However, edibles were expected to witness the highest CAGR during the forecast period between 2019 and 2025.
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