The not too distant future of cannabis industry
Updated: Nov 26, 2020
Humans have an ancient relationship with cannabis. Archaeologists have traced this relationship back thousands of years. Scientifically verified evidence demonstrating the use of smoked cannabis in spiritual rituals in eastern China has been dated as far back as 2500 years ago (Ren et al., 2019). Despite our war on cannabis and illicit drug use, the recognition of the medicinal potential of these substances has been gaining tremendous pace.
Amongst the many psychoactive substances, cannabis has gained international attention for its substantial medicinal precedence. An ever-expanding body of research is demonstrating that cannabis shares a unique connection to humans and mammals. This unique connection offers a wealth of explorative potential. In recent years, Commercial and industrial exploration has been amassing, resulting in rapid global growth across all seams of the cannabis market.It must be noted that the medical cannabis market is still in its infancy. However, this infant market is set to be one of the fastest expanding markets globally. The UK is in fact at the helm of this market, leading global production, and exporting more than 95 tonnes per year as of 2016 (INCB, 2016).Current estimates value the illicit cannabis market in the UK to be worth more than £2.6 billion, suggesting more than 255 tonnes of cannabis were illegally distributed to over 3 million consumers (Snowdon, 2018). As we internationally move towards a more decriminalized approach to drug use and consumption, the use of many drugs, such as cannabis, will become more socially acceptable. The growing medical interest in illicit drugs strengthens the arguments for decriminalization with other drugs such as LSD and MDMA being increasingly explored for their benefits in psychological disorders.
According to data from Statista, global spending on Legal cannabis is set to reach over $60 billion by 2024. In a world with increasing legalization and cannabis regulation, the cannabis market likely to see the same degree of market expansion as the Alcohol and Opiate industries. The UK would economy would be quick to benefit from this growing market, with a regulated, legal market projected to generate approximately £1 billion in tax revenue, contributed to by £690 million in tax revenues and subsequent proceeds from new streams of income, business tax and VAT (Snowdon, 2018).
By comparison, the UK alcohol industry was estimated to worth £46 billion contributing to 3.7% of all consumer spending (Bhattacharya et al., 2018). A taxed and regulated cannabis market would likely compete for command similar market value which would likely compete for portions of the alcohol market. The relative safety of cannabis compared to alcohol partly due to our unique biological relationship with cannabis mean that cannabis has far greater potential than alcohol to be integrated into society. The increasing awareness and discussion around cannabis have provoked alcohol and tobacco giants to reach into the cannabis market as it is a clear competitor to both industries. The alcohol industry has been in steady decline for some years and according to the institute of alcohol, studies derives 68% of its revenue from those regularly exceeding recommended alcohol intake levels (Bhattacharya et al., 2018). Although this seems a rather glum outlook for the alcohol in industry, there is also tremendous room for overlap between the alcohol industry and cannabis in a legalized environment which would be great for all involved.
If we factor in the vast potential for innovation within, overlap between the cannabis industry and other markets, along with the global progress towards drug policy reform, it is likely the cannabis industry will continue to expand beyond all predictions. The cannabis industry in its current form has been built off the back of just one of the thousand-plus molecules that are found within the plant, Cannabidiol (CBD). Further exploration into the scientific significance of the relationship between cannabis, humans, and the Endocannabinoid System. The endocannabinoid system regulates any systems of the human body and our expanding knowledge of this biology will unveil countless therapeutic opportunities for medical innovation and progression. This wave of information has muddied the water somewhat for consumers and numerous companies are taking advantage of the lack of regulation and consumer education. This lack of understanding and malpractice can be dangerous both for businesses and consumers alike, which is reflected in the vast numbers of contaminated CBD products as well as in the misrepresentation of CBD (Linger et al., 2002; Raber, Elzinga and Kaplan, 2015). Throughout this developmental journey, the market will have to constantly adapt whilst nations establish functional regulations for the safe integration of cannabis into society the cannabis market. This rapid evolution nurtures a survival of the fittest scenario for the cannabis industry, it is integral for business is to stay ahead of the curve.The next one of which will be come March 2021 and the onset of the Novel foods regulation of CBD. With vast experience in this market, Global Cannabinoid Solutions leverages extensive cannabinoid research expertise to guide those wishing to explore the investment potential of the cannabis market. Our knowledge of the fundamental science enables us to guide you through the intricacies of the cannabis industry whilst imparting key knowledge to and network contacts. At the core of our operations are our web of highly respected and trusted partners and experts who we work with to develop sustainable solutions delivering stability to your operations in a turbulent industry.
Bhattacharya, A. et al. (2018) ‘How dependent is the alcohol industry on heavy drinking in England?’ doi: 10.1111/add.14386.
INCB (2016) COMMENTS ON THE REPORTED STATISTICS ON NARCOTIC DRUGS Summary. Available at: http://www.incb.org/documents/Narcotic-Drugs/Technical-Publications/2017/7_Part_2_comments_E.pdf (Accessed: 18 May 2019).
Linger, P. et al. (2002) ‘Industrial hemp (Cannabis sativa L.) growing on heavy metal contaminated soil: fibre quality and phytoremediation potential’, Industrial Crops and Products. Elsevier, 16(1), pp. 33–42. doi: 10.1016/S0926-6690(02)00005-5.
Raber, J. C., Elzinga, S. and Kaplan, C. (2015) ‘Understanding dabs: contamination concerns of cannabis concentrates and cannabinoid transfer during the act of dabbing’, The Journal of Toxicological Sciences, 40(6), pp. 797–803. doi: 10.2131/jts.40.797.
Ren, M. et al. (2019) ‘The origins of cannabis smoking: Chemical residue evidence from the first millennium BCE in the Pamirs’, Science Advances. American Association for the Advancement of Science, 5(6), p. eaaw1391. doi: 10.1126/sciadv.aaw1391.
Snowdon, C. (2018) Estimating the Size and Potential of the UK Cannabis Market. Available at: http://iea.org.uk/wp-content/uploads/2018/06/DP90_Legalising-cannabis_web-1.pdf (Accessed: 18 June 2019).