In the few short years since CBD’s federal legalization, we’ve seen a roller-coaster of a story around hemp-derived remedies. From new brands and products cropping up everywhere, farmers producing hemp in mass, and national retailers discussing new CBD lines to failure, bankruptcy, and back again.
Much has changed since then, though. So what does the CBD industry forecast look like for this year? Many predict increased credibility in CBD’s effectiveness and CBD brands, retailers launching more new products, and the groundwork for general CBD industry growth laid in 2021.
From the Roots: How the CBD Industry Has Experienced Growth Thus Far
The U.S. federally legalized CBD in late 2018. But CBD’s legalization story begins in 2014 when Congress started an experimental endeavor that allowed hemp to be grown legally in the U.S. (for the first time since 1937).
Only 14 states participated initially, and even though the program was highly restrictive, it was an important first step. Keep in mind that at this time, there was an illegal underground market for CBD. Unfortunately, operators in this market provided questionable CBD at best since the products had no testing and no reliability.
When 2018 arrived with the bill that legalized hemp growth, states could now apply with the USDA to set up their own CBD system. Of course, this individual state-by-state method has its drawbacks—many hope for a forthcoming federal CBD policy to create a solid enforcement policy across every state.
After the bill passed, the CBD industry was flooded with money and news attention. However, the frenzy fell apart in the fall harvest of 2019 as a result of industry overflow. The CBD industry became so inundated with CBD startups and investments that it halted the quick growth people expected.
To make matters worse, the FDA then made retail adoption of CBD impossible. Their stance was that CBD as a natural alternative medicine was unsafe until proven otherwise. As a result, CBD was not permitted for retail sale, causing retailers to cancel their big plans for CBD products.
All of this led to a significant decrease in CBD industry value, with leading hemp processors failing or falling into bankruptcy by early 2020.
Back on the Rise: Current CBD Industry Projections for 2021
Despite the setback, the CBD industry is moving forward once more. Although it won’t be as quick as the first time, the groundwork is taking shape. Many believe that 2021 will be a turning point for CBD.
Adapting to the Times
The current CBD industry forecast takes note of those who survived the previous setback (by pivoting, finding new ways to make a profit, or shifting focus to execution) as leaders. With the prior loss of value, investors are hesitant to funnel money into the industry. This has two results:
- It makes it difficult for new CBD companies to get funding.
- Existing companies who fail to execute changes will find it hard to continue surviving in the industry
Consumer Demands and The FDA’s Two Cents
Although the FDA’s initial stance was that CBD was unsafe, more and more studies are coming out to prove otherwise. On top of that, consumers’ interest in health and wellness has skyrocketed, especially with the pandemic.
In search of natural alternative medicines for sleep troubles, inflammation, anxiety, migraines, chronic pain relief, and other ailments, consumers are looking to CBD. Thanks to expanded CBD research, consumers are finding cannabinoids to fit the bill.
The FDA isn’t blind to this, and many hope that a new federal FDA-approved CBD enforcement policy under Biden is in the works.
New Hope for Retailers and CBD Brands
Thanks to the disruption caused by COVID-19, retailers are seeking new ways to grow. With that mindset, CBD is once more at the top of their “most promising” lists.
In addition to CBD being a hot topic for retailers, CBD brands themselves are adapting. Now, efficacy matters. Brands are focused on the true impact of CBD on people’s lives. Does it work? Does it provide relief? Fast-acting products with proven results are key ingredients to CBD industry growth in 2021.
Piggybacking on the concept of CBD’s impact, credibility is becoming a brand staple. Consumers are looking for proof that CBD products work. They want to be able to trust CBD brands. This means brands that explicitly follow regulations are backed by proven research and are supported by credible names.
We’ve entered a new decade, and with it, we’re hoping to see growth in important places like the CBD industry. As credibility becomes crucial and research expands, we hope to see CBD as a widespread, successful natural remedy. Interested in learning more about CBD, have questions about how best to fit it in your routine, or are you interested in a medical marijuana prescription? Schedule a consultation with us!