Marijuana concentrates are the fastest growing product category in the cannabis industry, according to data released by Arcview Market Research on Tuesday. Projections for legal cannabis sales in the United States were produced in conjunction with BDS Analytics and are contained in the report “Concentrates: The Hottest Product Category in Cannabis.”
According to the data from Arcview, consumer sales of cannabis concentrates will grow by 49 percent in the second half of 2018, reaching a total of $2.9 billion. The research firm expects concentrates to be the second most popular cannabis product category with consumers after marijuana flower.
Dr. Markus Roggen, the vice president for extraction at OutCo Labs near San Diego, California, told High Times via email that the variety of concentrates available offer many new alternatives for cannabis consumers.
“Concentrates are the obvious future of cannabis because they allow for novel products such as oils, sauce, live rosin, tinctures, edibles, and topicals, which new consumers are more comfortable with than flower, as [it] removes the classic ‘stoner’ image from cannabis consumption,” said Roggen.
Legalization Leads to Innovation
Roggen noted that many firms are committing resources to further innovation in the production of cannabis concentrates.
“The entire industry has been investing heavily in research to develop the next generation of products,” said Roggen. “Here at OutCo our focus has been on high-terpene extracts, specifically, vape oil that maintains and represents the full-spectrum, pure cannabis plant as closely as possible.”
Troy Dayton is the CEO of the Arcview Group, the parent company of Arcview Market Research. He said in a release that sales of cannabis oils, vape cartridges, wax, shatter, and similar products continue to gain popularity with American consumers.
“As the cannabis industry matures, we’ll likely see new product categories catch fire with consumers,” said Dayton. “Concentrates are the first category to do that, but it’s just the beginning of a revolution in how cannabis is consumed now that it’s becoming legal around the world.”
Cannabis concentrates are expected to make up 27 percent of total sales of cannabis products in 2018. That is up from just 10 percent of sales only four years ago. More than half of the sales from the concentrates product category are expected to come from pre-filled vaporizer cartridges. Arcview predicts that vape cartridges will continue to be the dominant product in the category for at least the next five years.
By 2022, sales of cannabis concentrates are expected to reach a total of $8.4 billion in annual sales, nearly equaling the $8.5 billion is estimated sales of marijuana flower that year.
Vape Cartridges Offer Convenience
Vape cartridges offer consumers an option for consuming cannabis that can be clean, convenient, discreet, and simple to use. Tom Adams is the managing director of industry intelligence for BDS Analytics, a cannabis consumer research firm based in Boulder, Colorado. He said that concentrates continue the evolution of cannabis culture that has been going on for millennia.
“Technology is revolutionizing a product category that began as hand-rubbed hash in the Middle East centuries ago,” Adams said. “We believe the growth of the concentrate market will continue as the cannabis industry evolves and consumers look toward new and innovative delivery methods that fit their lifestyles.”
Adams told Bloomberg that many consumers see vape pens as a better option for consuming cannabis.
“Walking down the street and smoking a big, fat joint is not very discreet,” Adams said. “Taking a quiet hit on a vape pen is very discreet.”
Despite the explosive growth of cannabis concentrates, Adams believes that given a more liberal regulatory environment, sales would be even higher.
“It would be happening quicker, except there are so many limitations on it,” said Adams. “Lots of medical states allow flower only.”