Australia’s Medical Cannabis industry has experienced soaring growth and regulatory evolution since cannabis cultivation was legalised for medical purposes in 2016. Despite challenges relating to strict regulations and advertising restrictions, industry manufacturers have thrived, buoyed by the gradual societal acceptance of cannabis use. Industry revenue is expected to have skyrocketed at an annualised 78.1% over the five years through 2024-25, to $445.6 million. This includes an anticipated jump of 53.0% in 2024-25. Profit margins have remained negative, although losses are improving thanks to surging revenue and demand. In November 2021, revisions to regulations set out by the Therapeutic Goods Administration (TGA) led to a surge in prescriptions and improved patient access to medical cannabis treatments. These changes introduced five categories of approved product formats, simplifying the prescription process and enhancing efficiency for medical practitioners. Government initiatives – like making CBD products available over the counter and implementing a streamlined medicinal cannabis application process – have bolstered revenue for manufacturers. Greater investment in the Medical Research Future Fund (MRFF) and access to government grants have further supported the development of medical cannabis manufacturing. However, despite burgeoning sales and demand, imports have captured most demand, curtailing domestic production growth. As the industry matures, existing manufacturers are poised to benefit from economies of scale, while more international companies will enter the market through partnerships and acquisitions. Expanding demand and advances in medical cannabis technology will open up offshore opportunities, presenting substantial potential for Australian businesses to target export markets. However, the potential legalisation of recreational cannabis would present both opportunities and challenges for manufacturers. While medical cannabis users would likely stick with established manufacturers for their reliable and knowledge-based products, recreational legalisation could hinder demand from customers who don’t want to seek out a prescription. Industry manufacturers would have to carefully navigate this uncertainty and could consider expanding into the recreational market to capitalise on potential opportunities. Overall, industry revenue is forecast to soar at an annualised 11.4% over the five years through 2029-30, to $763.8 million.

The Australia Medicinal Cannabis Testing Market report segments the industry into By Product And Software/Service (Analytical Instruments, Spectroscopy Instruments, Consumables, Cannabis Testing Software And Services), By Service (Potency Testing, Terpene Profiling, Residual Solvent Screening, Heavy Metal Testing, and more), and By End User (Laboratories, Cannabis Drug Manufacturers And Dispensaries, Other End Users).

Market Overview The Australia medicinal cannabis testing market is projected to exhibit a significant 20.10% CAGR during 2025-2033, reaching a value of USD 112.39 million by 2033. The legalization and growing medicinal cannabis industry in Australia have fueled the demand for accurate and reliable testing services. Stringent regulatory compliance requirements, consumer safety concerns, and the need for standardized testing methods drive this market growth. Analytical instruments and software/services, including potency testing and terpene profiling, account for the largest revenue share in the market. Market Trends and Drivers The expansion of the medical cannabis industry, the increasing adoption of advanced testing technologies, and the emergence of cannabis-infused products create lucrative growth opportunities. The rising awareness about the therapeutic benefits of cannabis and the government's support for research and development further contribute to the market's growth. However, the strict regulatory framework for cannabis cultivation and testing poses a potential restraint. The market is expected to face competition from established players and new entrants offering comprehensive testing solutions. Recent developments include: June 2024: Tilray Medical, a division of Tilray Brands Inc. and a global leader in medical cannabis, launched Broken Coast EU-GMP-certified medical cannabis products in Australia.October 2023: Victoria’s Transport Legislation Amendment Bill 2023 amended nine Acts, including the Road Safety Act 1986. This amendment allows a study of medicinal cannabis and road safety and is sufficiently broad to enable the state government to conduct similar studies in relation to other drugs.February 2023: Aurora Cannabis Inc., the Canadian company, and MedReleaf Australia launched a new medical cannabis brand, CraftPlant, for patients in the Australian market.. Key drivers for this market are: Rise in Approvals for Medicinal Cannabis, Increase in Cannabis-based Prescription by Healthcare Practisioners; Growing Prevalence of Chronic Pain. Potential restraints include: Rise in Approvals for Medicinal Cannabis, Increase in Cannabis-based Prescription by Healthcare Practisioners; Growing Prevalence of Chronic Pain. Notable trends are: The Potency Testing Segment is Anticipated to Hold a Major Share of the Market.

The size of the Australia Medical Cannabis Market was valued at USD 151.20 million in 2023 and is projected to reach USD 1148.67 million by 2032, with an expected CAGR of 33.6 % during the forecast period. The Australia medical cannabis market is growing rapidly due to the increasing awareness of the therapeutic benefits of cannabis in treating various medical conditions. Since the legalization of medical cannabis in 2016, Australia has witnessed an increase in patient demand for cannabis-based treatments, especially in chronic pain, anxiety, epilepsy, and cancer-related symptoms. There have been supportive regulations put in place by the government to guarantee quality and safety, opening the industry up to investment both locally and internationally. Key players are licensed producers, healthcare providers, and pharmaceutical companies. All these focus on innovative cannabis-based therapies. The health care network of trained prescribers continues to expand, providing easy access for the patient. The market is also benefiting from the advancements in research and clinical trials, which are helping to expand the understanding of the medical potential of cannabis. As the number of patients grows and stigma decreases, the Australian medical cannabis market is well positioned for continued expansion. Recent developments include: In February 2024, Peak Processing Solutions, a subsidiary of Althea Group Holdings, entered into a contract with Collective Project to manufacture six cannabis-infused beverage products. , In January 2024, Althea Group Holdings Limited, a company specializing in producing and distributing cannabis-based items, introduced two new offerings: Althea THC10 and Althea CBD3:THC2. , In September 2023, MediPharm Labs introduced GMP strain-specific full-spectrum cannabis oil and inhalation cartridge products under the Beacon Medical brand. , In September 2023, The Therapeutic Goods Administration (TGA) of Australia granted Cannatrek GMP accreditation for its newly established processing facility in Shepparton, which was developed with an investment of USD 5 million. .

Medicinal Grade Cannabis Market Outlook

The global medicinal grade cannabis market size was valued at approximately USD 4.5 billion in 2023 and is projected to reach USD 28.3 billion by 2032, growing at a compound annual growth rate (CAGR) of 22.7% from 2024 to 2032. This robust growth can be attributed to increasing legalization of cannabis for medical use, rising prevalence of chronic diseases, and growing awareness of the therapeutic benefits of cannabis-based products.

One of the key growth factors for the medicinal grade cannabis market is the expanding legalization of cannabis across various countries for medical purposes. Over recent years, several countries have recognized the potential benefits of cannabis in treating a wide range of medical conditions, leading to legislative changes that allow for its medical use. This legislative shift is not just limited to developed countries but is also spreading to emerging markets, thus broadening the global market for medicinal grade cannabis.

The rising prevalence of chronic diseases such as cancer, arthritis, and mental disorders is another significant growth driver. As the global population ages, the incidence of these diseases is expected to increase, creating a higher demand for effective pain management and therapeutic solutions. Cannabis has been found to offer relief in chronic pain management, nausea, anxiety, and other symptoms associated with these conditions, making it an increasingly popular choice among patients and healthcare providers alike.

In addition to the growing acceptance of medicinal cannabis, advancements in cannabis research are also contributing to market growth. Ongoing scientific studies are providing more evidence of the efficacy and safety of cannabis in medical applications. Research is uncovering new therapeutic uses, optimizing dosage forms, and improving the quality and consistency of cannabis products. This research is crucial for gaining the trust of both consumers and healthcare providers, further driving market growth.

From a regional outlook, North America currently holds the largest share of the medicinal grade cannabis market, driven primarily by the United States and Canada. Both countries have well-established cannabis industries and a high level of acceptance among consumers and healthcare providers. Europe follows closely, with countries like Germany and the Netherlands leading in medical cannabis use. The Asia Pacific region is expected to witness the fastest growth, driven by legislative changes in countries like Australia and Thailand and increasing investments in cannabis research and development.

Product Type Analysis

The medicinal grade cannabis market is diversified in terms of product types, including flowers, oils, tinctures, capsules, and others. Each product type has its unique set of benefits and applications, catering to different patient needs and preferences. The flowers segment, which includes dried cannabis flowers, is one of the most traditional forms of medicinal cannabis. These are often smoked or vaporized by patients and are appreciated for their quick onset of effects. However, the flowers segment faces challenges related to dosage precision and the potential for respiratory issues.

Oils are another popular form of medicinal cannabis, often preferred for their ease of use and precise dosing capabilities. Cannabis oils can be ingested directly or added to food and beverages, making them versatile and convenient. The oils segment is expected to grow rapidly, driven by advancements in extraction technologies and increasing consumer preference for non-smoking methods of cannabis consumption.

Tinctures, which are alcohol-based cannabis extracts, offer another discreet and convenient option for patients. These are typically administered sublingually (under the tongue), allowing for rapid absorption into the bloodstream. Tinctures are gaining popularity due to their quick onset of effects and ease of dosage adjustment, making them suitable for patients who require a controlled and flexible treatment regimen.

Capsules represent a growing segment in the medicinal cannabis market. These offer the highest level of dosage precision and are often preferred by patients and healthcare providers seeking standardized treatment options. Capsules can be formulated to contain specific cannabinoids and dosages, providing consistency and reliability in treatment. The encapsulation technology also allows for the inclusion of other beneficial compounds, enhancing the therapeutic efficacy

The Australia legal cannabis market is projected to grow from USD 148.4 million in 2025 to USD 1,997.3 million by 2035, reflecting a CAGR of 30.1%.

Metric	Value
Market Size in 2025	USD 148.4 million
Projected Market Size in 2035	USD 1,997.3 million
CAGR (2025 to 2035)	30.1%

State-wise Outlook

Region	CAGR (2025 to 2035)
Western Australia	30.2%

State	CAGR (2025 to 2035)
Queensland	30.0%

State	CAGR (2025 to 2035)
New South Wales	29.8%

State	CAGR (2025 to 2035)
Victoria	30.1%

Legal Cannabis for Medical Use Market Outlook

The global market size for legal cannabis for medical use was estimated to be worth approximately $20 billion in 2023 and is projected to grow at a robust compound annual growth rate (CAGR) of 18% to reach around $90 billion by 2032. This explosive growth is driven by increasing acceptance of cannabis for medicinal purposes, expanding legalization efforts, and growing evidence supporting its therapeutic benefits.

One of the primary growth factors for this market is the expanding body of research that supports the efficacy of cannabis in treating a variety of medical conditions. Studies have shown that cannabis can be effective in managing chronic pain, alleviating symptoms of mental disorders such as anxiety and PTSD, and even providing relief in cases of severe debilitating conditions like cancer. This has led to greater acceptance among the medical community and patients, thereby fueling market growth.

Another significant factor contributing to the growth of the legal cannabis for medical use market is the progressive wave of legalization sweeping across various countries and states. Numerous regions are either decriminalizing or fully legalizing cannabis for medicinal purposes, thereby opening new markets and increasing accessibility for patients. This legislative shift not only reduces the stigma associated with cannabis but also ensures regulated, quality-controlled products are available to consumers.

The increasing investment from pharmaceutical companies and venture capitalists is also a key driver for market expansion. With more funding being funneled into research and development, the quality and variety of cannabis-based medical products are improving. This is likely to result in a broader range of applications and higher efficacy, which in turn, will attract more users. Investment from big players also signifies the potential profitability of this market, further accelerating its growth.

Medicinal Cannabis Compounding is an emerging area within the medical cannabis industry, offering personalized solutions tailored to individual patient needs. This process involves the preparation of customized cannabis-based medications, which can be adjusted in terms of dosage, form, and combination of active ingredients. Compounding allows healthcare providers to create specific formulations that address unique patient conditions, enhancing the therapeutic outcomes of cannabis treatments. As the demand for personalized medicine grows, medicinal cannabis compounding is gaining traction, providing patients with more precise and effective treatment options. This approach not only improves patient satisfaction but also expands the potential applications of medical cannabis, contributing to the overall growth of the market.

From a regional perspective, North America continues to lead the market, driven by early legalization and a mature infrastructure for dispensing medical cannabis. Europe is rapidly catching up, with numerous countries revising their policies to allow medical cannabis. The Asia Pacific region also shows promise, particularly with countries like Australia and Thailand making strides in cannabis legislation. This regional expansion is an essential factor contributing to the global market growth.

Product Type Analysis

The legal cannabis for medical use market can be segmented by product type into flower, oil, tinctures, capsules, and others. Each of these product types offers unique benefits and caters to different patient needs, contributing to the overall market diversity and growth.

The flower form of medical cannabis remains highly popular, especially among patients who prefer traditional methods of consumption such as smoking or vaporizing. This segment benefits from its familiarity, ease of use, and relatively low cost compared to more processed forms of cannabis. Additionally, the flower form is often the first to gain acceptance in new markets due to its simpler production process and established demand.

Oil-based cannabis products are gaining traction due to their versatility and potency. These products can be consumed directly, added to food and beverages, or used in various other formulations. The precision in dosing and higher potency levels make oil a preferred option for patients who require consistent and strong effects. This segment is expected to see significant growth, especi

The Australia Medicinal Cannabis Testing report provides a detailed analysis of emerging investment pockets, highlighting current and future market trends. It offers strategic insights into capital flows and market shifts, guiding investors toward growth opportunities in key industry segments and regions.

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Marijuana Market Size 2024-2028

The marijuana market size is forecast to increase by USD 87.8 billion at a CAGR of 32.14% between 2023 and 2028.

The market is experiencing significant growth due to the increasing legalization of cannabis for medical and recreational use in various regions. This trend is further fueled by the expansion of the e-commerce industry, enabling easier access to cannabis-infused edible products, CBD oil, and other cannabinoid-based offerings. However, the market also faces challenges such as the potential side effects associated with inappropriate use of medical marijuana and the need for effective pest control solutions to ensure product quality and safety. The cannabis industry is evolving rapidly, with a focus on innovation and compliance to meet the growing demand for CBD and other cannabinoid-based products.

What will be the Size of the Marijuana Market During the Forecast Period?

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The market encompasses a diverse range of products derived from the Cannabis plant, including flowers, concentrates, edibles, topicals and tinctures. Two primary types of cannabis are commonly recognized: Cannabis sativa and Cannabis indica. THC (tetrahydrocannabinol) and CBD (cannabidiol) are the most prominent cannabinoids, with THC producing psychoactive effects and CBD offering therapeutic benefits. Medical cannabis and recreational cannabis are the two primary market segments. Medical cannabis is used to alleviate symptoms of various conditions, such as chemotherapy-induced nausea, while recreational cannabis is consumed for its psychoactive properties. CBD products, such as CBD gummies, have gained popularity due to their non-psychoactive nature and potential health benefits.
The market is continually evolving, with new products and innovations emerging regularly. Cannabinoids, including CBD (Epidiolex) and THC (Sativex, Marinol, Syndros, and others), are being developed and marketed as pharmaceuticals. The cannabis market is experiencing significant growth and is expected to continue expanding due to increasing legalization, consumer demand, and ongoing research and development.

How is this Marijuana Industry segmented and which is the largest segment?

The marijuana industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

Product

  Medical marijuana
  Recreational marijuana


Type

  Oil and tinctures
  Flower


Geography

  North America

    Canada
    US


  Europe

    Germany
    UK


  APAC



  South America



  Middle East and Africa

By Product Insights

The medical marijuana segment is estimated to witness significant growth during the forecast period. Medical marijuana is experiencing significant growth In the US market due to its potential therapeutic benefits for various health conditions. Chronic pain, including neuropathic and inflammatory pain, is one of the primary conditions treated with marijuana. The increasing prevalence of chronic pain among adults and the popularity of medical marijuana as a pain reliever are driving market expansion. Additionally, medical marijuana has shown promise in alleviating nausea caused by conditions such as Crohn's disease, acute gastritis, hypoglycemia, panic disorder, and arachnoiditis. Marijuana plants used for medicinal purposes include Cannabis indica, Cannabis sativa, and hybrids. The market for medical marijuana products, including flowers, concentrates, edibles, topicals, and tinctures, is expected to continue growing due to their potential therapeutic applications in treating conditions such as epilepsy, multiple sclerosis, anxiety, cancer, glaucoma, and insomnia.

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The Medical marijuana segment was valued at USD 9.19 billion in 2018 and showed a gradual increase during the forecast period. THC and CBD are the primary cannabinoids found in marijuana, with THC providing psychoactive effects and CBD offering therapeutic benefits without the high. Other cannabinoid-based products, such as Sativex, Marinol, Cesamet, and various cannabis-based products, are also gaining popularity for their medicinal applications. The legalization of marijuana for adult use in some states and continued clinical trials for various conditions are further fueling market growth.

Regional Analysis

North America is estimated to contribute 87% to the growth of the global market during the forecast period. Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period. In North America, the legalization of marijuana for medical use is gaining momentum. In the US and Canada, marijuana is authorized for thera

Cannabis Market Outlook

According to our latest research, the global cannabis market size reached USD 67.2 billion in 2024, reflecting a robust expansion driven by evolving regulatory environments and increasing consumer acceptance. The market is projected to grow at a CAGR of 14.8% from 2025 to 2033, with the total market value forecasted to reach USD 196.3 billion by 2033. The significant growth momentum is primarily attributed to the rising demand for both medical and recreational cannabis, advancements in product innovation, and broadening legalization across key markets.

One of the primary growth factors for the global cannabis market is the progressive shift in legislative frameworks worldwide. Governments in North America, Europe, and parts of Latin America are increasingly recognizing the therapeutic benefits of cannabis, leading to the relaxation of restrictions and the establishment of regulated markets. Medical cannabis, in particular, has gained traction as scientific studies and clinical trials continue to validate its efficacy in managing chronic pain, neurological disorders, and various other health conditions. This regulatory evolution is not only fueling domestic consumption but also encouraging cross-border investments and collaborations, further accelerating market expansion.

Consumer awareness and acceptance of cannabis-derived products have witnessed a significant surge, contributing to the market's exponential growth. The stigma traditionally associated with cannabis use is gradually diminishing, thanks to extensive educational campaigns, advocacy by patient groups, and endorsements by healthcare professionals. The proliferation of diverse product formats such as edibles, concentrates, topicals, and wellness supplements is attracting a broader demographic, including older adults seeking alternative therapies and younger consumers interested in recreational experiences. This diversification in product offerings is enabling companies to tap into new user segments and sustain long-term growth.

Technological advancements in cultivation, extraction, and product formulation are transforming the cannabis industry landscape. Innovations such as precision agriculture, hydroponics, and advanced extraction techniques are enhancing product quality, consistency, and yield. These improvements are not only resulting in premium-grade cannabis products but are also fostering the development of novel applications across medical, recreational, and industrial sectors. Furthermore, the integration of digital platforms for sales and distribution is streamlining access to legal cannabis, thereby expanding market reach and driving revenue growth.

From a regional perspective, North America continues to dominate the global cannabis market, accounting for the largest share in 2024 due to favorable regulatory policies, high consumer demand, and a well-established supply chain. Europe is emerging as a significant growth frontier, propelled by incremental legalization and rising investments in research and development. Meanwhile, the Asia Pacific region is gradually opening up to cannabis, with countries like Thailand and Australia leading the way in medical cannabis adoption. Latin America and the Middle East & Africa are also witnessing increased activity, although market maturity varies significantly across these regions.

Product Type Analysis

The cannabis market is segmented by product type into flower, concentrates, edibles, topicals, and others. The flower segment remains the most traditional and widely consumed form, particularly among recreational users who prefer smoking or vaporizing. The popularity of cannabis flower is underpinned by its accessibility, affordability, and the immediate effects it delivers. However, the segment is experiencing intense competition from newer product forms as consumer preferences evolve. Companies are investing in premium and specialty strains to differentiate their offerings, while regulatory bodies are introducing qual

The Australia Legal Cannabis Market size was valued at USD 123.9 million in 2023 and is projected to reach USD 689.90 million by 2032, exhibiting a CAGR of 27.8 % during the forecasts period. Legal Cannabis refers to the cultivation, distribution, and use of cannabis products within the confines of the law. It encompasses various forms of the cannabis plant, including marijuana and hemp, which are cultivated and sold for recreational or medicinal purposes. One of its prominent features is the regulation imposed by governing bodies to ensure quality control and safety standards are maintained, unlike in illegal markets. Legal Cannabis offers several advantages. It generates revenue through taxation, contributing to government funds and potentially alleviating financial burdens. It promotes consumer safety by providing access to regulated products with known potency and purity. Additionally, it reduces the burden on law enforcement, allowing them to focus on more pressing issues. Recent developments include: In February 2024, Peak Processing Solutions, an Althea Group Holdings subsidiary, signed an agreement with Collective Project to produce 6 cannabis-based beverage products based on contract manufacturing. , In January 2024, Althea Group Holdings Limited, a manufacturer and distributor of cannabis-based products, launched two new products, Althea THC10, and Althea CBD3:THC2, and expanded its softgel capsule product range. , In June 2023, Cann Group Limited signed an agreement with Levin Health Pty Ltd., to supply cannabis flowers to Levin to meet the production of cannabis based products. .

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Legal Cannabis Market Size 2025-2029

The legal cannabis market size is forecast to increase by USD 142.39 billion at a CAGR of 31.7% between 2024 and 2029.

The market is experiencing significant growth driven by the increasing number of countries decriminalizing and legalizing cannabis use. This global trend is fueled by a growing recognition of the medicinal benefits of cannabis and shifting societal attitudes towards its use. A key trend in the market is the adoption of advanced techniques in cannabis cultivation, including hydroponics and greenhouse growing, which enable higher yields and improved product quality. However, the cannabis market faces challenges, particularly in the area of funding and investment. Despite its growth potential, the industry remains largely underbanked due to federal regulations in many countries, making it difficult for businesses to secure the capital they need to scale operations and meet demand. Companies seeking to capitalize on market opportunities must navigate these challenges effectively, exploring alternative funding sources and building strong business plans to attract investors. Overall, the market presents significant opportunities for growth, particularly in areas such as medical applications, product innovation, and international expansion.

What will be the Size of the Legal Cannabis Market during the forecast period?

Request Free SampleThe cannabis market encompasses a range of products derived from the cannabis plant, including CBD products. CBD, a non-psychoactive compound, is gaining traction in the medical field for its therapeutic potential in treating conditions such as epilepsy seizures and chemotherapy-induced nausea. Marijuana, a plant containing both CBD and THC, is classified as a Schedule I drug in the US, limiting its availability and use. However, the medical cannabis market is expanding, with pharmacists prescribing it for chronic disease treatment and managing chronic pain. The cultivation techniques used to produce these strains can significantly impact their medicinal properties. CBD and THC derivatives are also being explored for their potential in treating multiple sclerosis and other health conditions. The genetic makeup of the cannabis plant continues to be a focus of research, as scientists uncover new medicinal applications for this versatile plant.

How is this Legal Cannabis Industry segmented?

The legal cannabis industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD million' for the period 2025-2029, as well as historical data from 2019-2023 for the following segments. ProductMedical cannabisRecreational cannabisDerivative TypeCBDTHCBalanced THC and CBDSourceHempMarijuanaGeographyNorth AmericaUSCanadaEuropeFranceGermanyItalyUKMiddle East and AfricaAPACAustraliaChinaIndiaJapanSouth AmericaRest of World (ROW)

By Product Insights

The medical cannabis segment is estimated to witness significant growth during the forecast period.The medical cannabis market encompasses the utilization of cannabis and its derivatives for therapeutic applications. This segment holds significance due to the potential therapeutic benefits it offers for various medical conditions and symptoms. Medical cannabis is commonly employed to alleviate chronic pain, reduce inflammation, manage nausea and vomiting, stimulate appetite, and provide relief for symptoms related to diseases such as multiple sclerosis, epilepsy, cancer, and HIV or AIDS. Furthermore, it is being investigated for its potential therapeutic effects on mental health disorders, including anxiety, depression, and PTSD. Medical cannabis is available in different forms, including cannabis flower, extracts, tinctures, and edibles. The legalization of cannabis for medical use has led to the development of eco-friendly packaging solutions and the emergence of online platforms for sales. However, the market faces challenges such as illegitimate trade, social stigma, and regulatory complexities. The therapeutic potential of cannabis is attributed to its cannabinoid content, particularly cannabidiol (CBD) and tetrahydrocannabinol (THC). The medical field continues to explore the medicinal properties of cannabis and its species, Cannabis Sativa and Cannabis Indica, to address the unmet needs of patients. Pharmacists, medical practitioners, and state governments play crucial roles in ensuring the safe and effective use of medical cannabis. Despite the ongoing debates surrounding cannabis, its legitimization for medical use has gained momentum, with an increasing number of adults recognizing its health benefits. The market for medical cannabis products, including CBD, is expected to grow as more research is conducted on its therapeutic potential and its use becomes more mainstream.

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The Medicinal Cannabis Compounding market size was valued at USD 8.5 billion in 2023 and is projected to reach USD 30.8 billion by 2033, exhibiting a CAGR of 14.2% during the forecast period. The increasing adoption of medical cannabis for various therapeutic applications, such as pain management, epilepsy, and multiple sclerosis, is a major driver of market growth. Moreover, the legalization of medical cannabis in several countries and the growing awareness of its medicinal benefits are further contributing to the market expansion. The market is segmented by application, type, and region. The hospitals segment is expected to hold the largest share of the market, owing to the increasing use of medical cannabis in hospital settings for pain management and other therapeutic purposes. Cannabidiol (CBD) is the dominant type segment, due to its wide range of medicinal applications, including anxiety, pain relief, and inflammation reduction. North America is the largest regional market, with the United States leading the way in terms of medical cannabis legalization and adoption. The Asia Pacific region is expected to experience significant growth during the forecast period, driven by the increasing legalization of medical cannabis in countries like Thailand and Australia.

Medical Cannabis Oil Market Outlook

The global medical cannabis oil market size was valued at approximately $1.5 billion in 2023 and is projected to grow at a compound annual growth rate (CAGR) of 15.5% from 2024 to 2032, reaching an estimated $5.5 billion by the end of the forecast period. This significant growth is driven by the increasing acceptance and legalization of medical cannabis in various regions, coupled with rising consumer awareness regarding its therapeutic benefits.

One of the primary growth factors fueling the medical cannabis oil market is the expanding legalization and regulatory approval of medical cannabis across numerous countries. Governments and regulatory bodies are increasingly recognizing the potential benefits of medical cannabis for treating various ailments, leading to more favorable legislative frameworks. This shift in regulatory stance has opened new markets and created substantial opportunities for both established and emerging players in the industry.

Moreover, the growing body of scientific research supporting the efficacy of medical cannabis oil in managing chronic pain, mental disorders, and cancer-related symptoms is further propelling market growth. Clinical studies have demonstrated that cannabinoids like CBD and THC can effectively alleviate pain, reduce anxiety, and mitigate nausea associated with chemotherapy. As a result, healthcare providers are more inclined to recommend cannabis oil as part of treatment plans, boosting its adoption across the medical community.

Additionally, the increasing prevalence of chronic diseases and mental health disorders globally has spurred demand for alternative treatment options like medical cannabis oil. With traditional pharmaceuticals often accompanied by significant side effects, patients and healthcare professionals are seeking safer and more natural alternatives. Medical cannabis oil, with its relatively favorable side-effect profile, is emerging as a viable option, thereby driving market expansion.

Cannabis-based Medicines have become a focal point in the evolving landscape of medical treatments, particularly as more research highlights their potential benefits. These medicines, derived from cannabis plants, are being increasingly recognized for their ability to manage a variety of health conditions. The therapeutic properties of cannabinoids, the active compounds in cannabis, are being explored for their efficacy in treating ailments such as chronic pain, epilepsy, and multiple sclerosis. As the stigma surrounding cannabis diminishes, the demand for cannabis-based medicines is expected to rise, driven by both patient advocacy and the growing body of scientific evidence supporting their use. This trend is not only expanding the market for medical cannabis oil but also encouraging pharmaceutical companies to invest in the development of new cannabis-based therapies.

From a regional perspective, North America holds the largest share of the medical cannabis oil market, primarily due to the early legalization and widespread acceptance of medical cannabis in the United States and Canada. Europe follows closely, with countries like Germany and Italy leading the charge in medical cannabis legalization. The Asia Pacific region is also witnessing rapid growth, particularly in countries like Australia and Thailand, which have implemented progressive medical cannabis laws. These regional dynamics underscore the global shift towards embracing medical cannabis, setting the stage for robust market growth over the forecast period.

Product Type Analysis

The medical cannabis oil market can be segmented by product type into CBD oil, THC oil, and balanced CBD/THC oil. Each of these segments has distinct characteristics and applications, driving their respective market dynamics. CBD oil, known for its non-psychoactive properties, has gained widespread popularity for its therapeutic benefits without inducing a 'high.' This segment is expected to witness substantial growth as it is increasingly being used to treat conditions such as anxiety, epilepsy, and chronic pain. The growing consumer preference for natural and holistic treatments further bolsters the demand for CBD oil.

On the other hand, THC oil, which contains the psychoactive component of cannabis, is primarily used for its pain-relieving and appetite-stimulating effects. Despite regulatory challenges due to its psychoactive nature, the THC oil segment is seeing i

The Cannabis Pharmaceuticals Market size was valued at USD 7.8 billion in 2023 and is projected to reach USD 155.20 billion by 2032, exhibiting a CAGR of 53.3 % during the forecasts period. The cannabis pharmaceuticals market entails the process of manufacturing cannabis-based drugs for medical application. These pharmaceuticals mostly have the cannabinoids like THC or CBD for use in conditions like chronic pain, epilepsy, multiple sclerosis among others, nausea from chemotherapy. Egyptian applications: Anxiety and PTSD are other diseases which apply the use of applications. Some of the active market trends include, continuous and growing approval of medical marijuana, constant research and identification of the various usable cannabinoids and administration technology such as oral sprays and skin patches. It is also growing also as a result of the increasing awareness and demands for natural and or alternative medicines. Recent developments include: In September 2023, SOMAÍ Pharmaceuticals, a European manufacturer of pharmaceutical cannabis products, received authorization from the Portuguese Health Authority INFRAMED to produce, import, and export for its facility in Lisbon, Portugal. , In August 2023, Avicanna Inc. completed the acquisition of the Medical Cannabis by Shoppers operation from Shoppers Drug Mart, subsequently introducing a new medical cannabis care platform called MyMedi.ca. , In February 2023, Aurora Cannabis Inc., a Canadian company, partnered with MedReleaf Australia to introduce CraftPlant, a new medical cannabis brand. This launch introduced three innovative products, Navana, HiVolt, and Greendae, to serve the Australian patient community. , In January 2023, Celadon Pharmaceuticals Plc declared that the UK Medicines and Healthcare Products Regulatory Agency (MRHA) had officially registered its cannabis active pharmaceutical ingredient at its Midlands facility in the UK, meeting the Good Manufacturing Practice (GMP) standards. , In May 2021, Jazz Pharmaceuticals completed its acquisition of GW Pharmaceuticals plc, which manufactures and markets cannabinoid-based prescription medicines. .

The size of the Legal Marijuana Market was valued at USD 8.58 Billion in 2023 and is projected to reach USD 16.65 Billion by 2032, with an expected CAGR of 9.93% during the forecast period. The legal marijuana market includes growing, distributing, and selling the buds and their derivatives for medical and recreational use under regulatory systems. Legalized marijuana is characterized by regulated production with assured safety, quality, and controlled distribution. Important characteristics are therefore the following diverse product forms: buds, edibles, oils, and topicals to emphasize advancement in cultivation technologies like hydroponics, aeroponics, and genetic engineering to boost yield and potency. Applications range from treating chronic pain and epilepsy to other mental health illnesses, and leisure use for relaxation, as well as social consumption. Technological changes in extraction technology (CO₂ extraction, solvent-free) and in product development of CBD-infused products are two factors driving this market. The implications of the industry have been highly impactful on economics, creating numerous jobs and taxing revenue, not to mention less incarceration for cannabis offence-related crimes. A major push factor is the growing acceptance of marijuana's medicinal benefits, making it legal in many places and destigmatizing it. It has opened doors for investment, innovation, and healthcare integration into the market globally. Recent developments include: March 2022, Verano Holdings, the Cannabis multistate operator, has received an additional USD 100 million under its credit agreement to strategic initiatives and fund expansion. The primary asset in the acquisition will be the vertical medical marijuana business based in New York, which is one of the only licensed operations in that state., March 2022, HYTN Innovations Inc. has confirmed that via a manufacturing and sales agreement with Promethean BioPharma, the company has successfully created, and exported cannabis nano-emulsions that feature its proprietary Elevation Technology in the medical cannabis market in Australia., Report Outlook, Market overview highlights the global recognition of marijuana federally Legal Analysis Overview. Key drivers for this market are: . Driver 1, . Driver 2. Potential restraints include: . Restraint 1, . Restraint 2.

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Cannabinoids Market Size 2024-2028

The cannabinoids market size is forecast to increase by USD 88.4 billion at a CAGR of 30.41% between 2023 and 2028.

The market is experiencing significant growth due to the increasing recognition of cannabinoids' therapeutic potential in managing various health conditions. Key drivers include the legalization of medicinal cannabinoids and the launch of educational programs to raise awareness of their benefits. However, the market also faces challenges, such as the potential side effects associated with inappropriate use. Cannabinoids have shown promise in addressing inflammation, insomnia, cancer-related symptoms, and chronic pain. The immunological system and central nervous system are the primary targets for these compounds. As the use of cannabinoids, including marijuana and prescription drugs, becomes more widespread, it is crucial to understand their effects and proper application to maximize their benefits and minimize risks. The market's growth is expected to continue as research uncovers new applications and regulatory frameworks evolve to support their use.

What will be the Size of the Market During the Forecast Period?

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The market is witnessing significant growth due to the increasing awareness and acceptance of cannabis-derived products for various health conditions. The market encompasses a range of products, including body lotions, oils, capsules, and vaping items, derived from the cannabis sativa plant, specifically hemp, and medical cannabis. Cannabinoids are chemical compounds found in the cannabis sativa plant. The most prominent cannabinoids include cannabidiol (CBD), cannabigerol (CBG), and tetrahydrocannabivarin (THCV). Among these, CBD has gained significant attention due to its potential therapeutic benefits.
In addition, anxiety, seizures, muscle disorders, Parkinson's disease, chronic noncancer pain, cancer patients, neuropathy, vomiting, appetite, weight loss, and cancer progression are some of the conditions for which cannabinoids are being explored as potential treatments. The market is expected to continue its growth trajectory due to the increasing acceptance and legalization of medical cannabis and the growing body of scientific evidence supporting the therapeutic benefits of these compounds. However, it is essential to note that the regulatory landscape for these products is evolving, and it is crucial for companies to stay informed of the latest regulations and guidelines. In summary, the market in North America is experiencing steady growth due to the increasing demand for natural alternatives to synthetic products for managing various health conditions.

How is this market segmented and which is the largest segment?

The market research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD billion' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

Application

  Medical
  Non-medical


Channel

  Retail pharmacies
  Online stores
  Hospital


Geography

  North America

    Canada
    US


  Europe

    Germany


  APAC



  South America



  Middle East and Africa

By Application Insights

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

Medical cannabinoids derived from the Cannabis sativa plant, including Cannabidiol (CBD) and Tetrahydrocannabinol (THC), have emerged as potential alternatives to conventional pain management medications in the US. These compounds have shown efficacy in alleviating chronic non-cancer pain, particularly pain caused by nerve damage and inflammation. The increasing prevalence of chronic pain among adults in the country is a significant factor driving the growth of the market. Furthermore, medical cannabis testing and legalization in several states are fueling market expansion. In addition to pain relief, cannabinoids have demonstrated potential in treating conditions causing severe nausea, such as Crohn's disease, acute gastritis, hypoglycemia, panic disorder, and arachnoiditis.

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The medical segment was valued at USD 10.30 billion in 2018 and showed a gradual increase during the forecast period.

Regional Analysis

North America is estimated to contribute 64% to the growth of the global market during the forecast period.

Technavio's analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

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In North America, the legalization of cannabinoids for medical use in the United States and Canada is fueling market expansion. Notable companies providing cannabinoids in this region mimic the cannabinoid compounds naturally

Cannabinoids Market Outlook

According to our latest research, the global cannabinoids market size in 2024 stands at USD 22.3 billion, driven by increasing acceptance of medical cannabis, ongoing legalization efforts, and expanding applications in health, wellness, and personal care. The market is projected to grow at a robust CAGR of 17.2% over the forecast period, reaching an estimated USD 67.2 billion by 2033. This substantial growth is propelled by rising consumer awareness, evolving regulatory frameworks, and surging demand for cannabinoid-infused products across various industries, according to our comprehensive market analysis.

One of the primary growth factors for the cannabinoids market is the accelerating pace of medical cannabis legalization in key global markets. Countries such as the United States, Canada, Germany, and Australia are at the forefront, enacting favorable policies that enable the use of cannabinoids, particularly CBD (Cannabidiol) and THC (Tetrahydrocannabinol), in the treatment of chronic pain, neurological disorders, and cancer-related symptoms. This legislative shift not only enhances patient access to cannabinoid-based therapies but also encourages pharmaceutical innovation and clinical research. As a result, pharmaceutical companies are increasingly investing in the development of cannabinoid-derived drugs, further propelling market growth and expanding the therapeutic landscape for cannabinoids.

Another significant driver is the growing adoption of cannabinoids in the food and beverages, nutraceuticals, and personal care sectors. Consumers are increasingly seeking natural remedies and functional ingredients that promote wellness, stress relief, and improved sleep quality. This trend has led to a surge in demand for CBD-infused edibles, beverages, topical creams, and supplements, particularly in North America and Europe. The proliferation of online retail platforms and specialty stores has further democratized access to these products, making them widely available to a diverse consumer base. As regulatory clarity improves and product quality standards are enforced, consumer confidence in cannabinoid-based products is expected to rise, fueling market expansion.

Technological advancements in extraction and synthesis methods are also shaping the cannabinoids market. The emergence of synthetic cannabinoids and improved extraction techniques for hemp and marijuana-derived cannabinoids have enabled manufacturers to achieve higher purity, consistency, and scalability. These innovations not only facilitate the development of novel cannabinoid formulations but also allow for the customization of products to meet specific therapeutic or recreational needs. Furthermore, the increasing investment in research and development by both established companies and startups is driving the discovery of minor cannabinoids such as CBG (Cannabigerol) and CBN (Cannabinol), which hold promising potential for new applications in pharmaceuticals and wellness products.

Regionally, North America continues to dominate the cannabinoids market, accounting for the largest share in 2024, followed by Europe and Asia Pacific. The United States leads in terms of revenue, product innovation, and regulatory momentum, while Canada remains a key player in both medical and recreational cannabis. Europe is witnessing rapid growth due to increasing legalization and investments in cannabinoid research, especially in Germany and the United Kingdom. Meanwhile, Asia Pacific is emerging as a lucrative market, driven by rising consumer awareness, evolving legal frameworks, and the growing adoption of hemp-derived products in countries like China, Japan, and Australia. Latin America and the Middle East & Africa are gradually catching up, with progressive policies and investments in industrial hemp cultivation supporting future market growth.

Product Type Analysis

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Cannabis Lights Market Outlook

The cannabis lights market size is expected to grow significantly, exhibiting a remarkable compound annual growth rate (CAGR) of 12% from 2024 to 2032. In 2023, the global market size was valued at approximately USD 1.2 billion, and it is forecasted to reach an impressive USD 3.1 billion by 2032. This growth is being driven by the increasing legalization of cannabis around the world and the subsequent rise in indoor cultivation practices. The demand for effective lighting solutions is critical, as these systems mimic natural sunlight to optimize the photosynthesis process, leading to healthier plants and higher yields.

The growth of the cannabis lights market is primarily fueled by the ongoing trend of cannabis legalization across various countries, which has significantly boosted both recreational and medicinal cannabis cultivation. As governments continue to relax regulations, the cannabis industry is witnessing a surge in investment, leading to an expansion of indoor and greenhouse farming operations that rely heavily on sophisticated lighting technologies. Additionally, technological advancements in grow lights, such as LED innovations offering energy efficiency and greater light spectrum control, are further propelling market growth. These advancements are attracting cultivators who are focused on reducing operational costs while maximizing plant health and yield.

Another major growth factor is the increasing awareness among cultivators about the benefits of using advanced lighting systems. High-efficiency lighting solutions like LEDs and HPS grow lights provide a controlled environment that enhances the growth cycle and quality of the cannabis plant. This is particularly important for cannabis growers aiming to produce high-quality plants with specific cannabinoid and terpene profiles. Furthermore, advancements in lighting technologies have also made it easier for small to medium-sized enterprises to enter the market, thus broadening the scope and scale of production and contributing to market expansion.

The rise in technological innovations and research in agricultural sciences is also contributing to the growth of the cannabis lights market. Companies are continuously investing in R&D to develop lights that not only increase yield but also improve energy efficiency and reduce heat output. Such innovations are crucial for maintaining the delicate balance required in controlled environment agriculture. As a result, consumers are showing greater willingness to invest in newer lighting technologies that promise long-term benefits in terms of yield and energy consumption. The emphasis on sustainable and energy-efficient farming practices is thus becoming a pivotal driver of growth in this sector.

Regionally, North America is the dominant player in the cannabis lights market, driven by the growing number of legalized states in the U.S. and the established cannabis industry in Canada. Europe is also witnessing considerable growth due to the increasing acceptance of medicinal cannabis and evolving legal frameworks. Meanwhile, the Asia Pacific region is poised for significant growth, with countries like Australia and Thailand making strides in the legalization of medical cannabis. Latin America and the Middle East & Africa are gradually emerging markets as they begin to explore the economic potential of cannabis cultivation, thus opening new avenues for market players.

Product Type Analysis

The cannabis lights market is segmented by product type, which includes LED grow lights, HPS grow lights, fluorescent grow lights, and others. Among these, LED grow lights are currently leading the market due to their energy-efficient properties and ability to emit a full spectrum of light, which is essential for plant growth. The popularity of LEDs is bolstered by their long lifespan and low heat emission, which allow for closer positioning to plants without the risk of damage. In addition, technological advancements have made LEDs more affordable, thus making them accessible to both large-scale commercial growers and small-scale hobbyists.

HPS grow lights, or high-pressure sodium lights, continue to hold a significant share of the market due to their proven track record in large-scale cannabis cultivation. Known for their high-intensity light output, HPS lights are preferred by growers looking to maximize yield. However, they do have drawbacks such as high heat emission and energy consumption, which can lead to increased operational costs. Despite these challenges, they remain a staple in the industry, particularly for growers who have es

The industrial cannabis cultivation market is experiencing remarkable growth, driven by the increasing legalization and acceptance of cannabis for medical and recreational purposes. The market size is currently valued at $3.8 million and is projected to reach a staggering $4.7 million by 2033, exhibiting a significant CAGR of 20%. This growth is attributed to various factors, including government initiatives to legalize cannabis, the rising prevalence of lifestyle and chronic diseases, and growing awareness of the therapeutic benefits of cannabis. The industrial cannabis cultivation market is segmented based on application and type. The major applications of cannabis include pharmaceuticals, cosmetics, nutrition, and textiles. By type, the market is divided into hemp and marijuana. The market is dominated by North America, followed by Europe and Asia-Pacific. The increasing legalization of cannabis in the United States and Canada, as well as the growing acceptance of cannabis for medical use, are driving the growth of the market in North America. Europe is also experiencing significant growth due to the legalization of cannabis for medical and recreational use in several countries. The Asia-Pacific region is a promising market with a high potential for growth as the legalization of cannabis is gaining momentum in countries such as Australia, Thailand, and China.