The cannabis drinks segment has been steadily growing in popularity for the past couple of years. As the cannabis market has matured, players in the cannabis space have been developing a wide variety of products in a bid to capture a part of the massive cannabis market. Cannabis-infused beverages are the latest entrant in the cannabis market. Although the space is only a few years old, the global cannabis beverage market is already projected to be worth $2 billion by 2026.
Some of the biggest beverage companies in the world are betting big on cannabis-infused beverages. In March, Canadian cannabis company Canopy Growth, once the largest cannabis company in the world, launched its own brand of flavored CBD beverages called Quatreau in the United States. Six months later, Canopy Growth partnered with New York-based Karna Water to launch CBD-infused water called Karma CBD Water, available at 25,000 retailers across America. In August, American-Canadian brewing company Molson Coors expanded Verywell, its CBD beverage line under Truss USA, a joint venture with HEXO USA Inc. to 17 states.
Michael Bronstein, president of the American Trade Association for Cannabis, says both cannabis companies and mainstream beverage companies have shown considerable interest in cannabis beverages. A Cannabis Beverage Council launched by the association this year has even attracted the attention of Adolphus Busch V, the great-great-grandson of the founder of brewing company Anheuser Busch. Adolphus Busch V is the founder of Colorado-based ABV Cannabis.
Industry analysts say the segment’s popularity is due to three factors: demand for alcohol alternatives amid a generational decline in alcohol consumption, technological advancements that have significantly improved the quality of cannabis drinks, and fewer places allowing people to legally smoke or vape. According to Canopy Growth and Molson Coors, the companies are currently focusing their attention on drinks infused with hemp-derived CBD since THC beverages are still federally prohibited. As the public becomes more aware of CBD’s medical potential, demand for CBD-infused beverages is sure to increase.
A joint survey by Chicago-based company Aclara Research and Ipsos found that although cannabis beverages aren’t used as frequently as edibles, flower or vapes, people are increasingly using them in social situations.
The demand for cannabis beverages actually makes sense, analysts say, when you realize that alcohol consumption has been declining steadily over the past few decades. Beer only makes up 12.5% of generation Z’s alcohol consumption compared to 25% for millennials and 50% for baby boomers and generation X. With business drying up, mainstream beverage companies are casting their nets out for the next big thing.
And as those companies enter this coveted segment, they will have to contend with already established cannabis drinks companies such as BevCanna Enterprises Inc. (CSE: BEV) (OTCQB: BVNNF) (FSE: 7BC) that are making their presence felt among consumers.
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