OUR BUSINESS MODEL
Is there demand?
Due to the increasing and rapid legalisation on a global front (more than 50 countries), and growing international recognition by the World Health Organisation, Medical Faculties/ Organisations and the general public themselves, most product specific economists (including Euromonitor) estimate the annual Global Market to be in the region of $166 billion by the year 2025. This figure could be on the low side, as the combined medical conditions that can be treated with Cannabis by 2025 show the Global Market to be in the region of $680 billion. The true answer is probably somewhere in between.
There is currently insufficient supply of CBD product at market related prices, and with projected growth rate in excess of 29% per annum and limited supply, prices can only rapidly increase. The market is already seeking additional avenues of production in more diverse international locations to bolster supply.
As legalisation and usage develops country-by-country, it becomes easier to forecast future international trends. Also, due to quite accurate figures being available for the medical Cannabis market from 2015 – 2019, the initial growth curve is already very evident. In the graph below, past, present data and future forecasts are shown on an individual country-by-country basis. Of course, should China, Russia and India enter the market, or a definite link between cancer treatment and Cannabis be established (for example) the forecasts shown could well be eclipsed by unprecedented growth.
Projected Compound Annual Growth Rate (CAGR) in the Medical Cannabis market according to two major research groups is:
Adroit Market Research suggest a 29.3% growth in the size of the global market by 2026
Grand View Research gives the 2019 to 2025 growth at 23.9%
The current Global Demand for Cannabis product 2019 is in the region of $ 350 billion. Data contained in the following paragraphs shows that the global demand is not only going to grow on a geographic / legislative basis, but also in the amount of uses and applications that Cannabis can be used in. Studying the dates that the various countries have legalised Medical Cannabis applications shows that the vast majority of legislation has been enacted fairly recently, it is therefore self-evident that:
- As these newly legalised countries start to prescribe and branch out into the benefits of Medical Cannabis there will be a corresponding rise in demand and price, and
- As the acceleration in legalisation encompasses new countries; the market will grow not only in types of applications and products used, but also geographically too.
- a) A greater demand in the current market for the existing products, plus
b) Newly generated legalised geographic markets, plus
- c) Research and development generating new applications for the raw product, plus
d) Inadequate raw product supply
Can only mean a high demand, low supply, and expanding market. Economists describe this as the perfect environment for higher profits.