NEW YORK — The market research company Nielsen projects the U.S. hemp-based C.B.D market may be a $2.25 billion to $2.75 billion industry in 2020. The projection accounts for U.S. Food and Drug Administration rulings and other possible issues. The F.D.A. on Nov. 25, 2019, said it could not conclude that cannabidiol (C.B.D.), a hemp extract, is Generally Recognized As Safe (GRAS) among qualified experts for its use in human food or animal food.
“While the regulatory roadmap remains ambiguous, one thing is clear: The next decade for the hemp-based C.B.D. market has the potential to be a game-changer for the traditional C.P.G. (consumer product goods) and retail industry,” said Rich Maturo, vice-president of cannabis practice for New York-based Nielsen.
The user bases for capsules, gummies and beverages should grow significantly this decade, according to Nielsen. If the F.D.A. ever approves C.B.D. as GRAS, the user base of ingestible formats could grow as much as 250% to 375% in a year’s time. Cannabidiol especially shows potential in the beverage categories of coffee, functional waters, energy drinks, teas and sports drinks, according to Nielsen, adding brick-and-mortar retail channels this decade could steal C.B.D. share from online retailers, local specialty retailers, and vape and tobacco shops.
Education efforts targeted to health care providers also may increase the C.B.D. market in the 2020s. A Nielsen study found about one-third of health care practitioners were knowledgeable about laws surrounding hemp-based C.B.D. Among adults interested in C.B.D., 50% said guidance from a health care practitioner would motivate them to try a C.B.D. product, according to Nielsen. Cannabidiol products could be positioned as over-the-counter products targeting arthritis, sleep and general pain.
Production efficiencies linked to cultivation and extraction practices of hemp should bring down prices for C.B.D. products, according to Nielsen. The number of U.S. hemp farmers will rise over the decade, and Latin American farmers should grow hemp as well.