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April 2025
Principal Consultant
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The global cannabidiol market size is calculated at USD 8.97 billion in 2024, grew to USD 10.38 billion in 2025, and is projected to reach around USD 38.97 billion by 2034. The market is expanding at a CAGR of 15.83% between 2025 and 2034. The market is growing due to increased legalization, with companies offering diverse products like edibles and topicals. E-commerce has also expanded reach and boosted sales.
Cannabidiol (CBD) is a naturally found compound. It is the second most prevalent psychoactive compound in cannabis (marijuana). CBD is a crucial element in medicinal cannabis, which can be derived from hemp, a plant closely related to cannabis, or produced through synthetic methods in the lab. The CBD market is growing due to increased legalization, rising consumer demand for natural health solutions, and the diversification of products like edibles, topicals, and beverages. E-commerce has made CBD products more accessible, while mainstream acceptance of CBD as a non-intoxicating alternative to pharmaceuticals is driving further adoption. The World Health Organization's report states that CBD shows no signs of abuse or dependence in humans. There is also no evidence at present to suggest any public health risks linked to the consumption of pure CBD.
AI can transform the CBD market by streamlining product development, ensuring consistent manufacturing quality, and optimizing supply chains. It helps businesses analyze consumer data for targeted marketing, improve customer engagement, and stay compliant with changing regulations. AI also speeds up clinical research by identifying patterns and suggesting new areas of exploration. Additionally, AI-powered chatbots provide consumers with personalized information, enhancing their experience and confidence in CBD products. Overall, AI can drive innovation, increase efficiency, and improve product quality across the industry.
Growing Adoption of Cannabidiol Products
The growing adoption of cannabidiol (CBD) products is driving the market due to increasing awareness of CBD's health benefits, such as pain relief, anxiety reduction, and improved sleep. As consumers seek natural alternatives to pharmaceuticals, CBD’s popularity has surged, further fueled by wellness trends and the shift toward plant-based remedies. The legalization of hemp-derived CBD in various regions has boosted consumer confidence, while the rise of diverse products like edibles, skincare, and pet care items has expanded its appeal. Additionally, the growth of e-commerce platforms has made CBD products more accessible, fueling market expansion and creating new opportunities for businesses.
Regulatory Complexity
Regulatory complexity is a major restraint on the cannabidiol (CBD) market due to inconsistent laws and regulations across different regions. The legal status of CBD varies globally, creating challenges for businesses in ensuring compliance and navigating complex approval processes. Strict and varying requirements for product testing, labeling, and safety standards increase costs and delays. Additionally, the lack of standardized regulations for product quality and potency can lead to market inconsistencies and erode consumer trust, limiting the growth and expansion of CBD companies.
The Increasing Number of Retailers Offering CBD-based Products
The growing number of retailers selling CBD-based products presents a key opportunity for the market by increasing accessibility and raising consumer awareness. With more options available both in-store and online, consumers are more likely to try CBD products, driving adoption and boosting sales. Retailers also help build trust by offering education and support, further fueling market growth. Major health and wellness companies, such as CVS Health, Rite Aid, and Walgreens Boots Alliance, have started offering CBD-based products. CVS Health plans to sell CBD topicals in 800 stores, while Walgreens Boots Alliance will offer them in 1,500 U.S. locations. This growing in-store availability of CBD products is a key driver of the industry’s growth.
By source, the hemp segment was dominant in the cannabidiol market in 2024 and is projected to grow at the fastest rate in the market during the forecast period. Hemp-derived CBD is widely legal in many regions, making it a more accessible and consistent source of cannabidiol compared to cannabis-derived CBD. Additionally, hemp plants contain higher concentrations of CBD and lower levels of THC 0.3%, making them ideal for producing non-intoxicating products. The use of hemp-derived CBD is growing rapidly due to its anti-inflammatory, anti-aging, and antioxidant properties. Industries like pharmaceuticals, personal care, nutraceuticals, and food and beverages are increasingly incorporating CBD into products aimed at promoting health and wellness. With increasing consumer demand for natural and legal wellness options, the hemp segment is expected to continue expanding rapidly during the forecast period.
By sales, the B2B segment registered its dominance over the global cannabidiol market in 2024 due to the increasing demand for wholesale CBD ingredients and raw materials from manufacturers across various industries. Businesses in the pharmaceuticals, cosmetics, food and beverage, and wellness product sectors rely on B2B suppliers for high-quality CBD extracts and formulations. As the market for CBD products expands, the B2B sector continues to grow, driven by the need for bulk purchasing and partnerships to create a wide range of finished goods.
By sales, the hospital pharmacies sub-segment within the B2C segment is expected to grow at a lucrative rate between 2025 and 2034 due to the increasing adoption of CBD-based treatments for various medical conditions. As research supports the potential therapeutic benefits of CBD for pain management, anxiety, and other health issues, hospitals are more likely to incorporate CBD products into their treatment plans. This trend is further boosted by growing patient demand for alternative and complementary therapies, as well as the increasing acceptance of CBD in medical settings. With hospital pharmacies offering regulated and trusted products, this sub-segment is poised for significant growth.
By end-use, the pharmaceuticals segment held the major share of the cannabidiol market in 2024 and is estimated to grow fastest rate during the coming years due to the increasing recognition of CBD’s therapeutic potential. As more research supports its effectiveness for conditions like chronic pain, epilepsy, anxiety, and sleep disorders, pharmaceutical companies are increasingly incorporating CBD into prescription medications. Additionally, the rising demand for natural alternatives to traditional pharmaceuticals is driving both innovation and investment in CBD-based treatments. Regulatory advancements and growing consumer trust in CBD products further contribute to the rapid expansion of the pharmaceuticals segment. The shift of cannabidiol from herbal remedies to prescription drugs is expected to drive market growth. As recognition of its medical benefits, including its therapeutic properties, increases, demand for CBD products in the pharmaceutical sector is set to rise.
North America led the cannabidiol market share by 88% in 2024 due to widespread legalization of hemp-derived CBD, particularly in the U.S., and favorable regulatory frameworks. Increased consumer awareness of CBD’s health benefits, along with growing demand for natural wellness products, fueled market growth. The presence of major CBD companies and greater retail availability also contributed to North America’s market dominance. The Center for Rare Neurological Disease Research revealed in January 2023 that around 200,000 Americans are affected by rare neurological diseases. As the prevalence of these conditions and related complications rises, the demand for CBD products has increased, driving market growth in the region.
The U.S. market is growing due to the legalization of hemp-derived CBD, rising consumer demand for natural alternatives to pharmaceuticals, and increased awareness of CBD's health benefits. The U.S. CBD market is expanding due to the legalization of hemp-derived products, growing demand for natural alternatives to pharmaceuticals, and increased awareness of CBD's health benefits. Additionally, a significant portion of adults (70%) are concerned about current issues, particularly the economy (77%), the 2024 U.S. election (73%), and gun violence (69%).
The Canadian market is expanding due to increasing consumer interest in wellness and natural health products. As more people turn to CBD for its potential therapeutic benefits, demand is rising across various industries, including personal care, nutrition, and pharmaceuticals. Additionally, ongoing research and evolving regulatory frameworks are boosting confidence in CBD's safety and effectiveness, driving further market growth. The growing focus on holistic health and the rise in e-commerce platforms also contribute to the expanding market in Canada.
Europe is expected to be the fastest-growing in the cannabidiol market during the forecast period due to increasing consumer awareness of CBD's potential health benefits, such as pain relief, anxiety reduction, and skin care. As more countries in Europe relax regulations on hemp and CBD products, market accessibility is improving, leading to broader adoption. Additionally, the rising demand for natural and plant-based wellness products, coupled with a growing emphasis on holistic health, is driving this expansion. The increasing availability of CBD products through both retail and online platforms further supports this growth in the region.
The market is growing due to increasing consumer awareness of CBD's potential health benefits, such as pain relief, anxiety reduction, and improved sleep. Germany has one of the most favorable regulatory environments in Europe for CBD products, with clear guidelines and a well-established market for hemp-based goods. Additionally, the rising demand for natural and alternative wellness products, coupled with Germany’s strong focus on health and wellness, is driving market growth. The growing availability of CBD products in pharmacies, health stores, and online platforms further fuels this expansion.
The UK market is growing due to increasing consumer awareness of CBD's health benefits, including stress relief, pain management, and improved sleep. The increasing demand for natural wellness products, combined with the UK's growing acceptance of CBD as a therapeutic option, is driving market expansion. Clearer regulatory guidelines, including the legalization of hemp-derived CBD products, have also boosted consumer confidence and market accessibility. Moreover, the availability of a wide range of CBD products in pharmacies, health stores, and online platforms further supports the market's growth in the UK.
The Asia-Pacific market is estimated to grow at a significant rate during the forecast period, driven by rapid urbanization and increasing health consciousness among consumers. With a growing focus on mental well-being and natural remedies, CBD products are gaining popularity. In addition, the region's expanding middle class and rising disposable incomes are driving demand for wellness products, including CBD. China is the top hemp producer in Asia, accounting for nearly half of the world's hemp supply. It exports approximately 90% of its hemp products to countries such as the U.S., Germany, the U.K., the Netherlands, and Japan. Recently, China has also started cultivating hemp in three provinces specifically for CBD extraction. As more countries in Asia begin exploring the potential of CBD for both medical and recreational uses, regulatory changes are likely to open up new market opportunities, fueling the growth of the sector.
The Chinese cannabidiol (CBD) market is expanding due to the country's leadership in hemp production and increasing interest in CBD's potential health benefits. As China continues to grow its hemp industry, particularly for CBD extraction, the availability of raw materials is rising, creating opportunities for CBD product development. Additionally, the growing consumer interest in wellness, natural remedies, and alternative treatments is driving demand for CBD products. With regulatory shifts allowing more room for CBD exploration, China is poised to tap into both domestic and international markets, contributing to its market expansion.
The India CBD market is growing due to rising awareness of its health benefits, especially for pain management and mental wellness. As demand for natural remedies increases, CBD is becoming a popular choice. India’s strong herbal culture and evolving regulations on hemp cultivation further support market growth, along with rising disposable incomes and urbanization, driving greater product adoption.
In March 2025, Xebra Brands and BSK Holdings expanded their partnership to launch Elements CBD in the U.S. market. BSK, with a proven record of generating over $100M in revenue, will focus on promoting Elements in the wellness and active lifestyle sectors through its digital marketing expertise and subscription-based model. This move complements Xebra’s leadership in Mexico’s cannabis market. Rodrigo Gallardo, Interim CEO of Xebra Brands, commented, “We’re encouraged by BSK’s commitment to the Elements brand and their roadmap to scale it across the U.S. This step represents continued momentum and confirms our belief that Elements can thrive in top-tier CBD markets.”
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