The prices of CBD items used to be more than usual, but this is no longer the case, following the onset of the coronavirus epidemic. The global pandemic has driven down CBD product prices, and industry experts feel that the trend would last for a while. It is among the main trends that the research company Brightfield Group’s most recent market report highlights.
“There’s persistent price compression,” stated Bethany Gomez, the Brightfield Group’s MD. “At this juncture, we’re not expecting that to change.”
The company’s forecasters expect the sales of cannabidiol goods to reach around $5 billion in 2020. The growth rate of the CBD sector has become still from its breakneck speed in 2019, when sales increased to over $4 billion, as per the company data.
More individuals are purchasing cannabidiol, and owing to the epidemic, almost 40% of the customers the company surveyed recently, stated that they are consuming more of it. However, the company expects the industry-wide rate drops to slow down the market value expansion.
The 2019 CBD boom happened soon after the enactment of the Agricultural Adjustment Act, a legislation that eliminated industrial hemp and hemp-based products from the US’s controlled substances list. Marijuana is still an illegal substance under the Schedule I of the US drug policy. The AAA legislation left much power of making decisions regarding CBD guidelines to the FDA, but the federal agency has not yet formalized a policy.
In effect, CBD manufacturers felt that the Agricultural Adjustment Act permitted them to sell their products, and then, CBD goods proliferated online and in physical outlets. Many retail businesses started to carry CBD balms, oils, and creams, and companies started to compete for the business.
The price wars that started in the middle of 2019 caused the rates to drop by between 20% and 30%, stated Bethany Gomez. The industrial hemp harvest in the fall, caused an excessive supply of raw components, and it saw the arrival of more affordable CBD products. CBD item rates declined even more over the recent months due to the COVID-19-enforced enclosures of public health-associated outlets, plus economic pressures.
When the FDA will approve marketing cannabidiol in the form of a supplement, vendors could underline functional and structural claims regarding the potential advantages of it. However, this possibility rests on the regulatory steps of the federal agency.