The global cannabis market size is estimated to be valued at USD 27.7 billion in 2022 and is projected to reach USD 82.3 billion by 2027, recording a CAGR of 24.3% in terms of value. Both medical and recreational cannabis market, is currently in the center of whirl of legalization globally. The North American region dominated the global market, owing to the growing legalization trends in most of the states in the US and the increase in usage of cannabis for recreational purposes.
North America is currently the largest region in the Cannabis Market. The region comprises the United States and Canada, where the cannabis industry has experienced significant growth and regulatory changes in recent years.
Several factors contribute to the dominance of North America in the Cannabis Market:
Legalization and Regulatory Environment: In both the United States and Canada, there has been a shift towards the legalization and regulation of cannabis. Canada became the first G7 country to legalize recreational cannabis nationwide in 2018, while individual states in the United States have been progressively legalizing cannabis for medical and/or recreational use. This favorable regulatory environment has facilitated the growth of the cannabis industry in North America.
Mature Market: The cannabis market in North America has had a head start compared to other regions. With earlier legalization efforts and a longer history of cannabis use, the market has had time to develop and mature. This has allowed for the establishment of robust supply chains, distribution networks, and retail infrastructure, contributing to the market's size and dominance.
Investment and Capital Availability: North America has seen substantial investment and capital flow into the cannabis industry. The legalization and growing acceptance of cannabis as a legitimate industry have attracted both domestic and international investors, fostering the growth of businesses and driving market expansion. Access to capital has enabled companies to scale operations, develop innovative products, and expand their market presence.
Technological Advancements: North America has been at the forefront of technological advancements in the cannabis industry. From cultivation techniques and indoor growing technologies to extraction methods and product innovations, the region has seen significant developments. These advancements have helped improve efficiency, quality, and product diversity, further driving the market's growth.
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The medical segment sees demand for treating anxiety and pain management
Medical segment also significantly contributes towards the total cannabis market. Cannabis is used in treating various medical situations like anxiety, gastrointestinal disorders, seizures, and epilepsy. Increased network of cannabis dispensaries will help increase the reach of the cannabis products to consumers thus, projecting a bright future for the market.
Despite increased knowledge of its medical benefits, existing manufacturing inefficiencies and manufacturers poor-quality control are hindering output. Many products fail to meet regulatory and content requirements. However, because of enhanced manufacturing procedures and quality standards, the pharmaceutical industry is now poised to supply more consistent products.
The CBD-dominant segment is projected to account for the second-largest share in the cannabis market during the forecast period
High demand and progressive policy reforms will ensure the cannabis industrys growth. As more people around the world experience burnout as a result of work and other stresses, consumers are more inclined to focus on self-care and mental wellness, and CBD fits perfectly into this change. The CBD market has risen as a result of the progressive growth in the availability of CBD products. Furthermore, the industry is predicted to grow positively as a result of CBDs growing presence in edibles, skincare, and increased online distribution channels.