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The Americas cannabis market size, which was $93,487.2 million in 2019, is expected to witness a CAGR of 22.5% during the forecast period (2020–2025), to reach $293,791.0 million in 2025. The increasing use of cannabis in medicines and wellness products, its legalization for recreational purposes, and surging investments are some of the major driving factors for the Americas cannabis industry.
The COVID-19 pandemic has had a positive impact on the Americas cannabis market size, as the sales of marijuana increased during the crisis. Due to the sudden lockdown and business disruptions, the industry witnessed a notable number of merger and acquisition transactions fail during the pandemic. However, as restrictions are being lifted and markets are beginning to recover, it is expected that the merger and acquisition activities will pick up in the coming period. It will be mainly due to the increasing revenue from the rising sales in many jurisdictions, which will allow companies to acquire the smaller ones.
According to a survey conducted by American Medical Marijuana Association (AMMA) in the U.S., out of the total participants, around 30% have smoked more weed since the COVID-19 outbreak, due to the stress and anxiety caused by the pandemic. Canada and various U.S. states continue operating legal cannabis stores and recording increasing sales, as dispensaries are deemed 'essential businesses'. Thus, the demand has risen owing to the increasing product consumption by regular consumers and surge in day-to-day administration among new users.
The CBD category is slated to record the faster growth in the industry during the forecast period. This would primarily be due to the legalization of the cultivation and usage of hemp-derived CBD products in several countries in the region. Additionally, more people have started preferring CBD because it does not cause the euphoric effects associated with THC. In addition to this, CBD is used for various medical conditions, such as psychosis or mental disorders, inflammatory bowel disease, and depression.
The pharmacies category recorded the highest CAGR during the historical period (2018–2019). This was majorly due to the allowance of governments of North American countries for pharmacies to sell cannabis-based medical products. The U.S. national drug store chain markets topical CBD products, such as creams, sprays, and roll-ons, as an alternative source of relief. For instance, in March 2019, CVS Pharmacy announced that it started selling hemp-derived CBD products in eight states of the U.S.
The medicinal category is expected to account for the major share owing to the benefits offered by cannabis products to people suffering from arthritis, chronic pain, cancer, migraine, and several other health issues. Furthermore, the medical marijuana market is prognosticated to observe significant prosperity due to the increasing incidence of chronic diseases, number of countries allowing the use of the substance for medical purposes, awareness of patients as well as doctors about the benefits of cannabis, and investments in research and development (R&D).
The U.S. is the largest revenue contributor to the Americas cannabis market, and it is expected to witness the highest CAGR during the forecast period. The legalization of marijuana across the country, rising investments in the marijuana industry, and augmenting R&D activities aimed at studying the potential medicinal applications of marijuana are fueling the market growth. Various U.S. states have legalized therapeutic as well as recreational cannabis use, and in some states, patients can use marijuana after the authorization of their doctor.
The incorporation of advanced technologies to widen the access to cannabis is also being observed in the country. For example, a weed delivery company, Eaze, has raised $37 million for creating an online platform to ship CBD products to 41 states. All such developments are boosting cannabis consumption in the U.S., thereby supporting the industry growth.
Since the last few years, the rapid deregulation of CBD and hemp across the region has generated interest among Americas cannabis market players. This has led to a surge in market activities in the form of licensing, hemp and marijuana production, investment in R&D, and distribution of products. Market incumbents are trying to develop their supply chain, enter newer geographies, and ramp up the production of a differentiated array of CBD and THC products. These steps are aimed at developing a loyalist customer base, securing revenue channels, and generating brand equity in the nascent stage of the industry.
As the legal use of hemp and other cannabis products is rising, consumers are becoming more curious about their options. These include CBD and THC, two natural compounds found in the plants of the Cannabis genus. CBD is a pleiotropic compound, which can provide benefits such as pain relief, inflammation reduction, and preventing growth of cancer cells. In the same vein, THC-based products are used for treating insomnia, low appetite, anxiety, glaucoma, and muscle spasticity.
In order to generate interest among consumers and counter the negative image associated with cannabis and its derivatives, CBD and THC manufacturers are branding their products as lifestyle and wellness drugs. This move offers additional advantages, including high-volume consumption on a regular basis and expedited approvals by agencies regulating drugs and narcotic compounds.
There is a significant growing interest in the development of therapies and consumer products derived from cannabis and its constituent chemicals. The legalization of the product across the U.S. and Canada has caused a cascading effect leading to several regional countries joining the bandwagon of decriminalizing to even deregulating cannabis and the derived products.
Countries in Latin America (LATAM), such as Mexico, Brazil, Chile, Colombia, Argentina, and Peru, have completely or partially legalized the sale of CBD- and THC-infused products. While regulations vary across the region, almost all countries have increased the production of hemp and downstream hemp-based products that are expected to garner interest among locals. This has also helped national and state governments generate additional jobs and increase the revenue from the sale and licensing of these products. Other potential upsides include revenue from recreational and medical tourism and sales of paraphernalia. All these factors will continue to support the demand for CBD and THC products in the region.
|Base Year (2019) Market Size||$93,487.2 Million|
|Forecast Period (2020-2025) CAGR||22.5%|
|Report Coverage||COVID-19 Impact Analysis, Market Trends, Drivers, and Restraints, Value Chain Analysis, Revenue Estimation and Forecast, Segmentation Analysis, Country Breakdown, Major Country Analysis, Companies’ Strategic Developments, Product Benchmarking, Company Profiling|
|Market Size by Segments||Product Type, Distribution Channel, Application, Country|
|Market Size of Geographies||U.S., Canada, Brazil, Mexico, Argentina, Colombia, Chile|
|Secondary Sources and References (Partial List)||American Herbal Products Association, American Medical Marijuana Association, ANVISA (Brazilian Health Surveillance Agency), Association for the Cannabinoid Industry, Brazilian Health Regulatory Agency, Cannabis Marketing Association, Cannabis Trades Association|
Partnerships are being actively pursued by the players operating in the Americas cannabis market. As per the analysis, product launch is another important strategy being followed by market participants to cater to their customers with better offerings.
For instance, in February 2020, Hello Products LLC, owned by Colgate-Palmolive Company, announced the launch of a range of CBD-infused oral care products, including a CBD lip balm and CBD mouthwash with or without charcoal.
Similarly, in February 2020, Elixinol LLC announced the launch of omega turmeric CBD capsules. The capsules contain turmeric, along with 15 mg of CBD and 120 mg of algae-derived docosahexaenoic acid (DHA).
The americas cannabis market report offers comprehensive market segmentation analysis along with market estimation for the period 2018–2025.
Based on Product Type
Based on Legality
Based on Application
Based on Distribution Channel
The Americas cannabis market generated $93,487.2 million in 2019.
THC is the more-popular product type in the Americas cannabis industry.
The key reason for the advance of the Americas cannabis market is the legalization of marijuana for research, medical, and recreational purposes by the government of regional countries.
The U.S. offers the most lucrative opportunities to the Americas cannabis industry players.
Partnerships, mergers, and acquisitions rank high among the Americas cannabis market strategic developments.