The global cannabis market, valued at USD 41.95 billion in 2024, is projected to experience explosive growth, reaching USD 52.01 billion in 2025 and soaring to USD 290.73 billion by 2033, according to a recent report by Straits Research. This remarkable growth, driven by a robust compound annual growth rate (CAGR) of 24% during the forecast period (2025–2033), is fueled by increasing legalization, expanding medical applications, and the rising popularity of cannabidiol (CBD) in skincare products.
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Legalization Fuels Market Expansion
The global legalization of cannabis, particularly for medicinal purposes, is a key driver of market growth. Countries such as Canada, Uruguay, and Thailand have embraced recreational and medical cannabis use, while nations like Germany, Argentina, and 35 U.S. states have legalized medical marijuana. In the U.S., 15 states and two territories had legalized recreational marijuana by 2020, with more expected to follow. This growing acceptance, driven by cannabis’s proven therapeutic benefits for chronic pain, diabetes management, and glaucoma treatment, is propelling the market forward.
CBD Skincare: A Booming Trend
The rising popularity of CBD-infused skincare products, such as CBD Body Oil and CBD Face Cream, is transforming the beauty industry. These products are celebrated for their ability to hydrate skin, reduce dryness, and alleviate itching and pain. Major players like L'Oréal and Estée Lauder have entered the market with hemp-based offerings, while independent brands are seizing opportunities in this high-growth sector. Despite limited clinical research, consumer demand for CBD skincare continues to surge, creating significant market opportunities.
Market Challenges and Opportunities
While the cannabis industry faces challenges, such as limited access to banking services due to conflicting global regulations, the focus on cannabis’s health benefits offers immense potential. Cannabinoids, including tetrahydrocannabinol (THC) and CBD, are increasingly utilized for chronic pain relief, blood sugar stabilization, and other therapeutic applications. Innovations in genetic development and product delivery systems are further driving market growth, particularly in the recreational and medical segments.
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Regional Insights
North America: Leading the market with a CAGR of 14.5%, driven by widespread legalization and companies like CV Sciences offering hemp-based products for beauty, pet care, and nutraceuticals.
South America: The fastest-growing region, expected to reach USD 18 billion by 2030 at a CAGR of 13.9%, with Argentina and other countries relaxing cannabis laws.
Europe: Germany’s medical marijuana market is expanding rapidly, with imports rising from 4.5 metric tons in 2017 to 7.6 metric tons in 2018, supported by cultivation approvals for companies like Aurora and Aphria.
Market Segmentation and Key Players
The cannabis market is segmented by product type (capsules, concentrates, edibles), application (medical, recreational), and compound type (THC, CBD, balanced THC/CBD). The concentrates segment leads with a projected CAGR of 15%, while the recreational segment dominates applications with a CAGR of 14.7%. Key players driving innovation include Tilray, Canopy Growth Corp, GW Pharmaceuticals, Aurora Cannabis, and Aphria.
Recent Developments
November 2022: BioSteel Sports Nutrition Inc. partnered with elite hockey players to promote cannabis-derived hydration products.
October 2022: Canopy Growth Corporation established a U.S.-domiciled holding company to accelerate entry into the U.S. cannabis market.