CBD is an increasingly hot topic both in the UK and in the USA. CBD derived from industrial hemp was legalised in 2016 for the UK and as recently as 2018 for the USA.
Since then, the market growth in both nations has skyrocketed. There’s also been exponential growth across the range of products available, the number of manufacturers as well as volume of people using CBD products. These factors combined with bigger players in FMCG investing heavily into product development and research, it looks like the only way is up for CBD.
What is CBD?
CBD is a cannabinoid, derived from the hemp plant. Lesser known than THC, it’s gaining attention and legitimacy as a nutritional supplement in a growing number of circles. Unlike THC, CBD is non-psychoactive but still carries the calming effects. It’s also frequently used for its anti-inflammatory properties.
Product ranges and why people are using CBD:
A few years ago in the UK, CBD was still fairly “underground” and found only in a few vape shops and the more alternative health shops. Product quality and range was fairly limited and few people really knew much about what it was or why you’d want to use it.
Fast forward a few years, with a whole lot more research and advances in production methods, you can find CBD in most of the big health shop retailers. There’s even a number of specialist CBD shops popping up both on the high street and online.
As far as product range goes, previously you might have found drops, typically lower in strength with a strong “green” flavour and that was about it. Now, manufacturers are turning an increased focus to the health and wellness market.
Products quality and potency have significantly improved. With methods like CO2 extraction and the creation of CBD isolate, users can find almost totally flavourless products with much more higher concentrations. Consumers are more informed, no longer seeing CBD as a “seedy” product akin to something you’d find in a coffee shop in Amsterdam.
Said to help with recovery and inflammation after intensive exercise, even the likes of elite athletes are not only using CBD but are being sponsored by CBD manufacturers.
Aside from improving the quality of CBD oil drops and tinctures, manufacturers have diversified their product ranges. With the invention of vaping and the use of e-cigarettes, there was a new means for users to administer CBD.
Similar to how vapers use an e-cig to inhale nicotine for quick relief when they’re quitting smoking, people who have never smoked are now picking up a vape for CBD instead. With few ingredients and a quick absorption rate, users are enjoying vaping CBD for everything from stress to eczema.
The next step on was edibles and topicals. The spectrum for this market is huge. Ranging from patches, drinks, mints and gummies to skin care, gels and balms – we’ve seen a surge in manufacturers getting into these ranges. Even the likes of Coca Cola are exploring options in the CBD infused soft drink industry.
They’ve invested $15 million in Iris Nova, who created the Dirty Lemon CBD drink. With a third of UK consumers interested in buying food and drink products containing CBD, it’s likely to be the next gap getting filled in this growing industry.
The legality, manufacture and projected value of the CBD industry:
The US and UK are two of the biggest consumers and manufacturers of CBD products in the world, despite their relatively recent legalisation. Up until December last year when President Trump signed off on the farm bill, despite its incredibly low THC levels, hemp has been classified as a narcotic since 1937.
Now, so long as CBD products contains less than a maximum 0.3% THC level, you can legally buy them in any state. The law change is likely to make a significant impact in the US. With farming becoming less profitable in the States, hemp is set to breathe new life into a dying industry. Several states from Indiana to Kentucky produce large quantities of tobacco.
With global tobacco use dropping in value and facing less demand the world over, many farmers are starting to switch to hemp. Forty-one states have now implemented laws and regulations to encourage and enable more farmers into industrial hemp cultivation. It grows faster, is profitable and can be used for CBD products as well as textiles and biofuel.
In the UK, CBD was legalised in 2016 and has a maximum THC level allowable of 0.2%. Manufacturers of CBD products source their hemp from home and abroad, with an increasing number of growers popping up in Europe. Somnio, Love Hemp, Canabidiol and Hempen Co-Operative are all UK based and owned businesses, there’s also CannabiGold from Poland with distribution in the UK too. The spectrum of products and price points is huge, with some being more of an entry level step into the world of CBD, ranging up to jars of oil with a £399 price tag.
With all of the above in mind, there’s been a number of projections as far as market value goes. Starting back in 2015, the value grew from next to nothing to a $202 (£159) million in 2015. From there, it’s only gone up. Market industry experts have placed ballpark figures between $2.1 and $3bn (£1.66 – £2.37bn) by 2021.
In a world where sustainability and profitability are often mutually exclusive, hemp derived products seem to be defying this trend. Not only has its reputation improved, hemp-based products are improving the lives of farmers, the environment and being used by a broad spectrum of people for a multitude of reasons.
The self-care lifestyle is growing in popularity and with that, people are searching for natural alternatives to common ailments and complaints. Consumers are pulling away from over the counter and prescription pharmaceuticals for things like arthritis, sports recovery, anxiety and stress and looking for products derived from nature.
On instagram you’ll find millions of posts under hashtags like #wellness and #cbd. Go online or walk down the high street and you’ll see the increase in CBD products in health food stores and CBD exclusive shops.
Add to that an ever-increasing amount of investment into research and product development, the market looks set to boom.