In 2018, the estimated CBD (cannabidiol) usage rate among the adult population in the United States was 6 percent. This figure was estimated to increase to 35 percent by 2024.

Sales of CBD products in the United States stood at 4.17 billion U.S. dollars in 2022. By 2026, this market is expected to grow to 4.23 billion dollars in value.

It is expected that U.S. consumer sales of cannabidiol (CBD) will reach around 1.8 billion U.S. dollars by 2022, which would represent a significant increase from around half a billion U.S. dollars in 2018. Following a similar trajectory, sales of legal cannabis in the U.S. are projected to hit 23 billion U.S. dollars in 2025.

What are the benefits of CBD? Cannabidiol is a naturally occurring substance found in cannabis. However, CBD does not cause any of the psychoactive effects that come from another active ingredient found in the plant: tetrahydrocannabinol (THC). The health benefits of the plant extract continue to be examined, and the World Health Organization states that CBD exhibits no effects indicative of any abuse or dependence potential. The CBD retail industry is already flourishing, with a wide range of products marketed as treatments for chronic pain, anxiety, and depression.

CBD in the USA: sales by state With estimated sales of around 730 million U.S. dollars, California had the biggest CBD market in the United States in 2019. Regulations concerning the use of cannabidiols are yet to be clearly defined, and state authorities are having to answer numerous questions about its legality. It is, however, currently illegal under U.S. law to market CBD by adding it to a food or labeling it as a dietary supplement. As of March 2020, the FDA has approved only one CBD product: Epidiolex. The prescription drug is used to treat two rare and severe forms of epilepsy.

Tinctures were the top selling CBD product in the United States in 2021. Tinctures represented a market value of nearly one billion U.S. dollars in that year. The second most popular product category was topicals at a value of over 800 million dollars.

Expert industry market research on the CBD Product Manufacturing in the US (2005-2030). Make better business decisions, faster with IBISWorld's industry market research reports, statistics, analysis, data, trends and forecasts.

California was the leading market for CBD (cannabidiol) in the United States in 2019 with estimated sales of 730 million U.S. dollars. Rounding out the top three were Florida and New York with about 290 million and 215 million in sales respectively.

Cannabidiol

Cannabidiol, also known as CBD, is a substance that can be found in marijuana or hemp, which is a specific strain of the Cannabis sativa plant. Given CBD’s relaxing qualities, it is used to create various products, which are sold in many types of stores across the United States. Some of 2019’s best-selling CBD products sold in U.S. convenience stores included CBD vitamins and sleeping remedies.

CBD products for pets

CBD products come in various forms, such as supplements, beauty products, food, and drinks. While it is not the most common use for the substance, in some instances, CBD comes in the form of pet products. In 2019, the most common types of CBD pet products in the United States were treats and chewies. Approximately 50 percent of pet owners in the country had bought such CBD products for their pet(s) that year.

According to some projections for the United States, the total market for pharmaceuticals derived from cannabidiol (CBD) will reach a size of over two billion U.S. dollars in 2026. That would be around ten times the amount reported for 2019.

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US Cannabis Market Size 2025-2029

The US cannabis market size is forecast to increase by USD 141.48 billion billion at a CAGR of 37.1% between 2024 and 2029.

The US cannabis market is experiencing significant growth driven by key demographic trends and advancements in research and production of medical marijuana. The millennial population, the largest consumer demographic in the US, is increasingly embracing cannabis use, particularly for medicinal purposes. This shift in consumer behavior is fueling market expansion in states with legal medical and recreational marijuana programs. Furthermore, the investment landscape is evolving, with an increase in funding for research and production of medical cannabis. This influx of capital is enabling companies to innovate and improve product offerings, as well as expand their reach and distribution networks.
However, challenges persist, including accessibility issues and high prices associated with medical cannabis. As the market continues to mature, companies must navigate these challenges effectively to capitalize on growth opportunities and maintain a competitive edge. Strategic partnerships, operational efficiency, and a focus on patient care and education will be essential for success in this dynamic and rapidly evolving industry.

What will be the size of the US Cannabis Market during the forecast period?

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The cannabis market in the US is experiencing significant growth and transformation, driven by increasing legalization efforts and shifting consumer preferences. The market encompasses a range of cannabis products, including flowering plants and derivatives such as CBD-related items, cannabis-infused edibles, beverages, vapes, and extracts. Medical marijuana continues to gain traction due to its therapeutic applications for conditions like chronic pain and multiple sclerosis. Legalization for recreational use is expanding, leading to the proliferation of dispensaries and online sales. Regulatory changes and consumer adoption are fostering innovation in product development, from cannabis oils(Cannabinoids) to advanced cannabis-infused beverages and edibles.
Social acceptance is on the rise, with millennials leading the charge. Industrial hemp cultivation is also contributing to the market's expansion, with applications ranging from textiles to CBD production. Overall, the cannabis market is poised for continued growth and evolution, shaped by regulatory developments, consumer trends, and product innovation.

How is this market segmented?

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments.

Derivative Type

  CBD
  THC
  Balanced THC and CBD


Product

  Medical
  Recreational


Source

  Marijuana
  Hemp


Geography

  US

By Derivative Type Insights

The cbd segment is estimated to witness significant growth during the forecast period.

The CBD segment is projected to dominate the US cannabis market due to the federal legality of hemp-derived CBD oil. This trend is driven by relaxing government norms regarding CBD usage in most states and at the federal level. As of 2024, Georgia and Indiana allow hemp-derived CBD oil for medicinal purposes, with THC content restrictions. Marijuana legalization for medicinal and recreational use varies across states, leading to the growth of medical marijuana dispensaries and the production of marijuana flower, CO2 oil, butane hash oil, live resin, and ice water hash. The market encompasses a range of consumable products, including edibles, infused beverages, and vapes, as well as topical products and medical hemp.

While some consumers use cannabis for mind-altering effects, others seek therapeutic applications for medical indications such as chronic pain, multiple sclerosis, and neurological health management. Cannabidiol (CBD) is a major component of medical cannabis, offering potential benefits for mental health management and pain relief. However, the market faces challenges related to packaging-related modifications, inhalation hazards, and social stigma. Despite these challenges, the market is expected to grow, driven by increasing acceptance of cannabis for medicinal and recreational use.

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The CBD segment was valued at USD 8.76 billion in 2019 and showed a gradual increase during the forecast period.

Market Dynamics

Our researchers analyzed the data with 2024 as the base year, along with the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

What are the key market drivers leading to the rise in adoption of US Cannabis Market?

Growing millennial populati

The market value of CBD-infused beverages in the Untied States is predicted to grow substantially over the coming years. By 2023, the market is expected to be valued at 1.4 billion U.S. dollars, over 16 times greater than its 2018 size.

The Commercial Building Inventories provide modeled data on commercial building type, vintage, and area for each U.S. city and county. Please note this data is modeled and more precise data may be available through county assessors or other sources. Commercial building stock data is estimated using CoStar Realty Information, Inc. building stock data.

This data is part of a suite of state and local energy profile data available at the "State and Local Energy Profile Data Suite" link below and builds on Cities-LEAP energy modeling, available at the "EERE Cities-LEAP Page" link below. Examples of how to use the data to inform energy planning can be found at the "Example Uses" link below.

By 2024, California is expected to be the largest CBD market in the United States with sales reaching over 3.3 billion U.S. dollars. Florida and New York would round out the top three with sales of 1.8 billion and 1.5 billion respectively.

Vitamins and supplements were the largest segment of the hemp based cannabidiol (CBD) market in the United States in 2023. In that year, sales of the segment reached 29.3 million U.S. dollars. Hand and body lotions were the next largest segment at 9.2 million dollars.

Sales of CBD products for pets grew tenfold in 2019 compared to 2018 in the United States. The market is expected to grow further in the coming years to approximately 560 million U.S. dollars by 2021.

By 2025, the CBD food and beverage market in the United States is expected to be valued at 2.65 billion U.S. dollars. CBD-infused beverages are projected to make up 64 percent of that market, at a value of 1.7 billion dollars.

This statistic depicts the dollar sales of hemp-based cannabidiol products in the natural and specialty channel in the United States from 2014 to 2018 with projected figures from 2019 to 2022. In 2018, hemp-based CBD products generated about 57.5 million dollars in sales.

This statistic depicts the dollar sales of cannabidiol products derived from marijuana in the United States from 2017 to 2022, broken down by product content. In 2018, high THC cannabidiol products generated about 77 million dollars in sales.

This statistic depicts the total cannabidiol sales in the United States from 2016 and 2017, with expected sales values for 2020 and 2022. In 2018, sales of CBD marijuana amounted to about 177 million U.S. dollars.

This statistic depicts the total cannabidiol sales in the United States from 2014 to 2017, with expected sales values for 2018 to 2022, broken down by market type. In 2017, about 124 million dollars of medical CBD was sold, compared to 54 million dollars of adult-use CBD.

In the United States, sales of cannabidiol (CBD) in the e-commerce channel are forecast to increase from approximately two billion U.S. dollars in 2021 to more than six billion U.S. dollars by 2026.

Electronic smoking devices were the CBD sales leaders in convenience stores in the United States in 2023. The category accounted for 12.6 million U.S. dollars in sales during the year. Infused bottled water was the next best selling category at 3.4 million dollars.