Zenith Global’s new report on the North American CBD Drinks Market charts its recent progress and highlights new obstacles that must now be overcome.
Regional retail sales in 2020 are estimated at US$180 million, with US growth much more heavily dependent on an uncertain regulatory environment than any disruption from coronavirus. The Canadian market has been held back by an underdeveloped dispensary network and overpriced products along with concerns over the accuracy of consumer dose claims.
“Many of the 2018 market leaders have disappeared,” commented Zenith Global category research director Amy Lathrop. “Hemp is becoming the new password for regulatory acceptance. Much will depend on the policy of the next US administration.”
The Zenith Global report gives a comprehensive analysis of definitions, the law, enforcement, CBD oil extraction and production, trading, mergers and acquisitions, joint ventures, regulation and taxation by state, retail adoption, market development, branding, innovation, distribution, pricing, packaging and trends, as well as providing profiles of selected leading brands.
Lathrop elaborates: “The development of cannabidiol (CBD) infused beverages has been the latest wellness trend to hit the North American market, primarily in the US, despite the Food and Drug Administration (FDA) maintaining regulatory authority over CBD additions to food and drink items.
“Consumer demand for better-for-you products has been instrumental in raising awareness of cannabidiol as an ingredient for wellness beverages. Functionality has become a key selling point.
“Instability in the regulatory environment is dampening overall market growth. At the moment, cannabis-derived CBD (cCBD) is regulated as a cannabis product, while hemp-derived CBD (hCBD) is more widely available, as allowed by state law. The FDA, state and local agencies lack a clear set of regulations and hCBD-infused beverages remain illegal to sell.
“Beyond the US, the nascent category has started to gain traction in Canada after resolving challenges with packaging. CBD drinks are regulated as a legal marijuana product, but growth prospects remain positive,” she concludes.
