North America Legal Cannabis Market Size, Share & Trends Analysis Report By Source (Marijuana, Hemp), By End-use (Recreational, Industrial, Medical Uses), By Derivative (CBD, THC), And Segment- Industry Analysis, Share, Growth, Regional Outlook and Forecasts, 2023-2032

The North America legal cannabis market size was estimated at USD 15.26 billion in 2022 and is expected to hit around USD 60.14 billion by 2032, poised to reach at a notable CAGR of 14.7% during the forecast period 2023 to 2032.

Key Takeaways:

• Based on source types, the market is further segmented into marijuana and hemp. The marijuana segment dominated the market in 2022 and accounted for the largest share of more than 86.11% of the overall revenue and is anticipated to register the fastest growth rate of 15.1%. by 2032
• The Cannabidiol (CBD) segment led the market in 2022 with a share of more than 65.16% of the total revenue due to the high acceptance of CBD for several therapeutic purposes.
• cannabinoids, terpenes, and flavonoids, are included in this part. Other is anticipated to register the fastest growth rate of 16.9%.
• The medical application segment accounted for the highest revenue share of more than 77.10% in 2022.
• During the projection period, the recreational segment is anticipated to register the fastest growth rate of 19.6%.
• In 2022, U.S. accounted for the largest revenue share of 86.17%. Other factors driving the regional market
• During the forecast period, Canada is anticipated to register the fastest growth rate of 16.8%.

North America Legal Cannabis Market Report Scope

Cannabis was made illegal by the tax act passed in 1937, California was the first state to make cannabis legal for use in medical applications, in 1996. North America has played a major role in shaping the legal cannabis industry. Maximum states across the U.S. and Canada have legitimized the use of cannabis for medical as well as recreational purposes. The drug has been studied for its effectiveness in managing chronic conditions in a much more efficient manner as compared to a contemporary line of treatment and thus has gained a lot of traction in recent years, propelling the growth of the regional market.

Cannabis is used in the form of oils and tinctures, or as dried flowers or buds. In epileptic seizures, it is frequently used to stop or reduce episodes of seizures. The active compounds CBD and THC in cannabis both bind to pain receptors and reduce the signals being transferred, due to these effects it is frequently being prescribed for chronic pain in conditions like multiple sclerosis, HIV/AIDS, etc.; there are only limited studies on effects and working of cannabidiols or active compounds in cannabis, despite which it is gaining a lot of popularity as an alternate treatment in the medical sector.

Governor Phil Murphy signed three laws in February 2021 to legalize recreational usage of cannabis for individuals aged 21 years and older in New Jersey, the United States. Laws regarding legalization differ greatly between Canada and the U.S.; in Canada, provinces have control over how cannabis and its products are sold in that region, and government-operated stores are more common than privately owned stores, like in Quebec. Whereas, in the U.S., most of the stores are privately owned and have little to no government control. Further legalization and use of cannabis-based products are expected to be aided by increasing government measures aimed at reducing the region’s illegal drug market.

The MORE (Marijuana Opportunity, Reinvestment, and Expungement) Act, for example, was reintroduced in the United States House of Representatives in May 2021. If passed, the bill would put an end to the federal government’s prohibition on cannabis and would help decriminalize the drug. On the economic front, adult-use legalization will help create new job possibilities and add billions to the economy. Tourism, real estate, finance, food, and transportation are just a few of the industries that will benefit from legalization. Many banks, for example, have begun to accept loans for marijuana businesses, which will gain traction following the legalization of marijuana for adult use.

As a result, the upcoming adult-use legalization is likely to increase the consumption of legal cannabis and shrink the criminal market, thus supporting the growth of the legal market in North America. The presence of strict laws, on the other hand, makes it more difficult for manufacturers to establish a workable and legal route for the production and distribution of cannabis-derived goods like cannabidiol. Because different governments allow different activities in terms of hemp processing, extraction, and cultivation, several firms are obliged to operate in different countries.

This makes it challenging in determining the source of the cannabidiol product and who is accountable for the end product’s quality. As a result, the legal cannabis market is expected to be hampered by the varying restrictions for these goods in the region. The COVID-19 outbreak has significantly hampered the cannabis supply chain. As a result of the global ban, the supply of cannabis in dispensaries has plummeted. The supply chain has been disrupted as a result of lockdowns in major countries, affecting both import and export businesses.

The number of patients using cannabis as a medication, on the other hand, is certain to rise as the number of medical diseases that require marijuana treatment rises. Moreover, as per the poll, roughly 22% of respondents said they used more cannabis during the COVID-19 pandemic than they did before the outbreak. Furthermore, roughly 56% of respondents said they used the same quantity of cannabis before and throughout the pandemic. Such studies and cases show that cannabis products and derivatives are becoming more widely used in the region. BofA Securities also reported an increase in cannabis sales by 42% in 2022, in the USA.

Sources Insights

Based on source types, the market is further segmented into marijuana and hemp. The marijuana segment dominated the market in 2022 and accounted for the largest share of more than 86.11% of the overall revenue and is anticipated to register the fastest growth rate of 15.1%. The growing legalization of marijuana for medicinal use due to various health benefits is the key factor driving the segment. The marijuana segment is further divided into three categories, namely flower, oil, and tinctures.  Most people prefer flowers as it is far less expensive than other oil & tinctures and has greater efficacy, which increases segment growth.

In addition, as nations in the region work to liberalize marijuana regulations, demand for cannabis-based products and derivatives is expected to rise. One of the key elements indicating a bigger proportion of the segment is the better efficiency of CBD obtained from marijuana. Changing attitudes toward marijuana-based products, as well as changes in legal frameworks in countries in North America, are also expected to drive the segment growth.

Derivatives Insights

The Cannabidiol (CBD) segment led the market in 2022 with a share of more than 65.16% of the total revenue due to the high acceptance of CBD for several therapeutic purposes. This high percentage can be attributed to the rising public awareness about the health advantages of cannabidiol, positive legislative policies, and the increased use of CBD oil in multiple industries along with its use in several medicines. This increase can be attributable to a shift in the general perception of the public towards these products as well as a surge in demand for products sourced from natural substances. For example, it is being extensively used by the cosmetic industry in lotions, serums, etc. they have been effective for relieving dry skin, inflammatory skin conditions, etc.

The increased demand and surge in the number of CBD-infused products being sold in the market are driving the growth of this segment. Other derivatives found in the cannabis plant, such as minor cannabinoids, terpenes, and flavonoids, are included in this part. Other is anticipated to register the fastest growth rate of 16.9%. One of the major factors driving market expansion is an increase in studies claiming the benefits of minor cannabinoids, including CBG, CBC CBDa, and others. Furthermore, an increase in the number of players offering minor cannabinoid and terpene products, as well as increased awareness about the health benefits they provide, are likely to fuel the segment growth over the projection period.

End-use Insights

Based on end-uses, the market is divided into recreational, medical, and industrial use. Due to the rising acceptance of cannabis for medical purposes, the medical application segment accounted for the highest revenue share of more than 77.10% in 2022. Recently, there has been a rising trend in plant-based medicines, especially for the management of pain. The current medications available in the market are opioid-based and are often habit-forming and harmful in the long run, thus there has been a shift in demand toward CBD-based products. This has been driving the growth of the market.

The upward trend is backed by ongoing research being carried out by several institutes across the region for different medical conditions as well as the high rate of legitimization. Although the use of cannabis is legal for medical purposes, the prescription of the same is based on the patient’s preference. Furthermore, changing consumer attitudes regarding cannabis use is another aspect driving market expansion. According to a CDC report published in 2019, marijuana is one of the most regularly used illegal narcotics in the United States, with approximately 18% of the population having used it at least once.

During the projection period, the recreational segment is anticipated to register the fastest growth rate of 19.6%. The recreational use of cannabis has been allowed in Canada and some states in the United States; hence, positive government actions, combined with increased use of cannabis for recreational purposes, are projected to boost market expansion. Furthermore, governments are attempting to reduce the drug’s illegal commerce, and aggressive actions in this regard could help increase the recreational use of cannabis in the future years.

Country Insights

Supportive government rules and the partial legalization of cannabis for medical and adult (recreational) use in the United States and Canada have aided the expansion of the regional market. In 2022, U.S. accounted for the largest revenue share of 86.17%. Other factors driving the regional market include the presence of key marijuana producers in the region. With the growing legalization of medical marijuana and the government’s liberalism on the subject, the United States holds the greatest revenue share and will continue to maintain the market position in the coming years. Furthermore, the passage of the 2018 Farm Bill, which legalizes hemp and hemp-based products in the U.S., is a major factor driving the product adoption.

The business is being fuelled by the increased demand and positive consumer perceptions of cannabis and its derivatives in the country. During the forecast period, Canada is anticipated to register the fastest growth rate of 16.8%. A surge in the number of local firms entering the dynamic market is due to an increase in the number of users and favorable government efforts to boost the cultivation, manufacture, and sale of cannabis-based goods in Canada. Furthermore, important participants in the country’s funding prospects are likely to assist in the expansion of the local and regional markets during the forecast period.

Key Companies & Market Share Insights

A rise in the number of cannabis-infused products in the market has created a space for a large number of firms to operate within North America. An increasing consumer base has also been responsible for the growth of the overall industry. Furthermore, mergers & acquisitions, partnerships, product launches, and collaborations are projected to increase market competition. Canopy Growth Corp., for example, introduced SurityPro, a new line of CBD-infused products for dogs, in 2021 to improve joint health and flexibility, healthy aging, quiet demeanor, and general physical and mental well-being. Some prominent market players in the North America legal cannabis market are:

• Insys Therapeutics, Inc.
• SUNDIAL
• Cara Therapeutics
• Tilray
• Aurora Cannabis
• The Cronos Group
• Jazz Pharmaceuticals, Inc.
• North America Legal Cannabis Market Segmentation
• North America Legal Cannabis Market Key Players And Regions
• Companies Profiled
• Regions Covered

Segments Covered in the Report

This report forecasts revenue growth at country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2032. For this study, Nova one advisor, Inc. has segmented the North America Legal Cannabis market.

By Source 

• Marijuana
  • Flowers
  • Oil and Tinctures
• Hemp
  • Hemp CBD
  • Supplements
  • Industrial Hemp

By Derivative 

• CBD
• THC
• Others

By End-use 

• Medical Use
  • Chronic Pain
  • Anxiety and Depression
  • Cancer
  • Arthritis
  • Diabetes
  • Glaucoma
  • Migraines
  • Epilepsy
  • Multiple Sclerosis
  • AIDS
  • Amyotrophic Lateral Sclerosis
  • Alzheimer’s
  • Post Traumatic Stress Disorder (PTSD)
  • Parkinson’s
  • Tourette’s
  • Others
• Recreational Use
• Industrial Use

By Country 

• U.S.
• Canada