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CBD Industry: What to Expect in 2024

CBD industry

Image credit: Elsa Olofsson via Unsplash

Since its legalization, cannabis has appeared more in mainstream media, and more consumers and companies are showing interest in it. In the U.S., the cannabis market was valued at 14.6 billion as of 2021 and is projected to grow at a compound annual growth rate (CAGR) of 16.2% from 2021 – 2030.

As such, the CBD industry is constantly evolving, and the growth potential seems limitless.

That said, 2023 was challenging for the industry, from falling cannabis prices to looming economic difficulties foreshadowing a possible recession, inflation, and oversupply. Looking ahead to 2024, the CBD industry is poised for significant changes that will impact everyone, from consumers to manufacturers.

Here is what to expect during the year, whether you are a seasoned entrepreneur or a curious consumer.

 

Potential Trends to Expect in the CBD Industry in 2024

 

Increased Regulation

With the growing popularity of CBD products, their permeance into various industries has opened up a broader consumption landscape. As such, the industry is facing increased scrutiny from legislators and regulators.

For instance, the FDA has yet to establish clear guidelines for selling and marketing CBD products, which has led to confusion and inconsistency in the industry. This lack of proper regulation has also made it harder for consumers to know what they are getting when they buy these products, as there are no standardized labeling or testing requirements.

However, there are signs this might change. In 2020, the FDA presented a report to Congress on developing a regulatory framework for CBD products. As of December 2021, the agency had released a draft outlining the use of CBD in dietary products. In 2024, expect to see more standardized regulations and guidelines to ensure the safety and quality of CBD products in the market.

 

Expansion of Product Offerings

As more people get interested in CBD and its products, you can expect to see a wider variety of CBD products in the market. While CBD oils and tinctures have been quite popular in the last few years, more opportunities are emerging for its incorporation in fast-moving consumer goods (FMCG), skincare products, edibles, beverages, and even pet products.

Another factor driving CBD product expansion is increased competition among manufacturers. With more players entering the market, there’s more demand for new and unique CBD products that stand out.

According to experts at Highline Wellness, this demand has led to a wave of innovation, with manufacturers experimenting with fresh ingredients, formulations, and delivery methods, such as transdermal patches and inhalers, to create products that appeal to a broader range of users.

 

Continued Research into Cannabis

Although CBD has been studied for its potential benefits, there is still much to learn about its effects on the body and how to eliminate any undesired results. However, this research has been dramatically affected by the Controlled Substances Act (CSA), which governs federal cannabis policy.

Fortunately, Congress recently passed a stand-alone cannabis reform bill: the Medical Marijuana and Cannabidiol Research Expansion Act (MMCREA).

This bipartisan bill opens the way for more research into the medical use of cannabis by rolling back federal restrictions on research and the cultivation of research-grade cannabis. It also promotes the development of FDA-approved drugs using CBD and cannabis.

In 2023, you can expect to see continued research into the potential uses of CBD and its interactions with other medications. For one, researchers are looking into how they can synthesize new compounds based on natural cannabinoids.

 

More Push for Federal Legalization of Cannabis

Getting federal and banking legalization has been a major part of the CBD industry. Thanks to increased public support, which is at an all-time high, in 2023, we expect to see more lobbying for CBD reforms.

For one, there’s a push for more states to legalize its use and for federal legalization. As for banking reforms, the Secure and Fair Enforcement (SAFE) Banking Act might get re-introduced to Congress.

If passed into law this year, it would provide a safe harbor for financial institutions that serve state-legal cannabis and CBD companies.

This would allow these businesses to access banking services like loans, credit lines, and checking accounts without fear of federal prosecution. This would help the CBD industry grow and mature, potentially leading to increased investment, innovation, and job creation.

 

Growing Delta-8 Popularity

Delta-8-tetrahydrocannabinol (Delta-8 THC) is a minor cannabinoid that occurs naturally in cannabis plants. It has become quite popular as a legal alternative to Delta-9 THC, the psychoactive compound present in high concentrations in marijuana. As CBD becomes more mainstream, consumers are increasingly fond of Delta-8 products.

Delta-8 THC is legal under federal law as long as it is derived from hemp and contains less than 0.3% Delta-9 THC. It is said to have similar effects to Delta-9 THC, including relaxation, pain relief, and a mild euphoric feeling without harsh aftereffects.

As a hemp derivative, it falls under the same legal category as CBD. It can disrupt the CBD market by giving consumers an alternative product with similar benefits but slightly different effects.

Some industry experts predict Delta-8 could become a significant player in the CBD market in 2024, primarily as it is marketed as a milder alternative to Delta-9 or a complementary product.

About 35% of cannabis users have used psychoactive hemp derivatives in the last year. Even in places where THC is legal, 23% of cannabis users say they will buy Delta-8 products in the future.

 

CBD business

Image credit: Priscilla Du Preez via Unsplash

 

Final Words

The emergence of Delta-8 THC in the CBD market could signal increased competition and innovation, but it is still too early to say how significantly it will impact the industry.

That said, the legal status of Delta-8 THC is still unclear, with ongoing debates about its safety and efficacy. Additionally, regulations may change, and they could become more tightly controlled or even prohibited in the future.

The CBD industry is expected to continue its growth trajectory in 2024. However, it’s essential to remember that it is still evolving and subject to changes in legislation, regulations, consumer demand, and scientific research.

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