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edible CBD chocolate

U.S. hemp-based CBD industry to reach $6 billion by 2025

There’s been a lot of buzz over non-consumable, hemp-based CBD products being sold at the retail level. While marijuana is legal in some states, edible products containing CBD from hemp are regulated by FDA, which has begun hearings examining the potential deregulation of CBD from hemp within food products.

The potential legalization of edible CBD could have a major impact on the U.S. CPG industry, particularly for the snack and confectionery category, according to Nielsen, which predicts the U.S. hemp-derived CBD market could be a US$6 billion industry by 2025 when considering legalized sales of food and beverage products containing CBD from hemp. Nielsen forecasts sales of CBD beverages to reach $1.7 billion by 2025, while sales of CBD edible foods to hit $950 million.

Consumers are increasingly seeking out snacks with added health and wellness benefits, and many believe adaptogens and botanical hemp extracts that naturally contain CBD could be the next frontier in snacking. Nielsen noted future CBD consumers may look to CBD-infused food offerings to enhance focus, relaxation, and to assist in promoting their general health and wellness. For others, consumption may be geared toward targeting specific ailments such as feminine pain, digestive issues and sleep disorders. According to Nielsen, CPG snack companies interested in reaching these consumers should start factoring various need states, use cases, and snacking occasions into their research and development (R&D) equation.

One caveat regarding the opportunity edible CBD from hemp presents is that the market is in its infancy in the United States. In addition, it’s incredibly volatile given factors such as changing state and federal regulations, supply issues, and retail/manufacturer and consumer sentiment and acceptance. Therefore, it is critical to recognize that the market size prediction is just a snapshot vision of what tomorrow could look like and is certainly subject to change based upon newer information.

FDA has concluded CBD and THC—the psychoactive compound responsible for the “high” from consuming marijuana—cannot be added to conventional food or marketed in a dietary supplement because the compounds were first studied as drugs. But FDA has authority to create an exception by issuing regulations, a process that could take several years. The agency has already received more than 1,100 comments, reflecting substantial interest in a cannabis-derived compound that has proliferated in food, dietary supplements and other FDA-regulated products over the last five years. FDA Acting Commissioner Ned Sharpless, M.D., recently underscored his agency has many questions about CBD that remain unanswered.

Within packaged food, Euromonitor International expects global sales of CBD products to double over the next two years. According to Zora Milenkovic, head of drinks and tobacco at Euromonitor International, CBD and THC are the superpower holistic food ingredients of the future—think turmeric (anti-inflammatory) crossed with coconut oil (essential fatty acids). CBD/THC falls within the naturally functional and mindful consumption trends, tapping into the vegan, plant-based and free-from movements.

In a recent article in INSIDER’s “CBD Digital Magazine,” Milenkovic wrote: “as CBD and THC become more mainstream, and manufacturers recognize their potential, the market will be dominated by outcome-based products: a specific dose, in a specific combination, carried in a specific format to address a specific condition, potentially in microdoses, blurring the boundaries between food and consumer health. This outcome-based future for cannabis products means by 2030, most people will use a product containing cannabis, and the current $10 billion global market for legal cannabis will have easily multiplied several times over by then.”

Click here to find out the current regulatory state of play with CBD.

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