Cannabis Edibles Could Capture Half the $5.4B Market


Ryan Allway

February 9th, 2016

Policy, Top Story


The cannabis industry reached $5.4 billion in 2015, according to ArcView Market Research, which is up from just $4.6 billion a year earlier. According to many dispensary owners, cannabis edibles and other infused products account for at least half of the total market. These figures are growing as consumers that were previously turned off by smoking have embraced edibles as an easier way to get a “high” without the pungent smell or health risks.

Snoop Dogg’s Leafs and Dixie Elixirs have become established brands in the space, but there’s a lot of room for new competition. According to Angel.co, a venture investing website, there are 50 companies and nearly 1,000 investors active in the space. Popular up-and-comers include Pot-O-Coffee, which offers cannabis-infused coffees, and Cannabis Connect, which aims to become an “Etsy for cannabis” online cannabis edibles exchange.

Craft vs. Mass Market

Many experts believe that the early cannabis edibles market will be dominated by craft cannabis manufacturers. After all, the Pacific Northwest is known for its “craft thinking” when it comes to beer, coffee, and other similar products. The high price tag of recreational marijuana also limits the market to connoisseurs of sorts that can afford to pay, rather than mass markets that are simply looking for the cheapest product on the shelf.

If legalization spreads throughout the United States, these dynamics could quickly change as larger companies get involved. There have been long standing rumors that Philip Morris and other large tobacco companies are interested in the young industry, which could mean mass-market products that are more targeted towards cost. Presumably, the price of marijuana would also drop as scale increases and budget-conscious consumers would be reached.

For now, the market appears to fall squarely in the “craft cannabis” arena, driven by a wide array of regional producers with non-corporate backgrounds. Dixie Elixirs – arguably the largest competitor in the space – was started in 2010 by a serial entrepreneur who took the time to learn the intricacies of growing marijuana. Many smaller companies are focused on niche products that may appear in only one or two dispensaries.

Cannabis Edibles Safety

Many regulators have targeted the cannabis edibles industry due to safety and labeling concerns – especially when it comes to children. Not surprisingly, emergency room visits by children that ingested THC-infused candies and sodas by mistake have been on the rise.

The industry has responded by installing tamper-proof containers to prevent easy access by children, while avoiding any kind of labeling that may appeal to children. In late-2014, Colorado implemented new rules requiring a diamond shape containing the characters “THC!” in an effort to piggyback off of the popular poison labels on household cleaners and other products.

Aside from exposure to children, the industry also continues to struggle with proper labeling of THC and/or CBD content. The THC in a cookie or candy bar isn’t always distributed evenly and labeled correctly, which is a potential pitfall for medical marijuana patients seeking a specific dose or recreational users looking to consume only a single serving. Some products are also packaged confusingly, such as a single candy bar accounting for 10 servings or more.

What’s Next for Cannabis Edibles?

The $5.4 billion cannabis industry has been quickly overrun by edibles producers, who are making it much easier and more pleasant to consume cannabis. While the market remains young and faces hurdles now, many industry experts believe that it will continue to take market share and become a growing force within the industry.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.


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