CBD Marketplace Rapidly Expanding as Revenues Projected to Reach Well Into the Billions

Written By: Stratton Report
September 14, 2018


The Cannabidiol infused products market continues to experience rapidly rising consumer demand as its multi-billion dollar revenues climb higher. The industries that CBD has worked its way into are numerous, with innovation creating new products almost on a daily basis. Between 2017 and 2018, the U.S. hemp-derived CBD market has nearly doubled in size, but the five-year growth projections for this market are now dramatically higher than they were a year ago and some believe will eventually eclipse the cannabis market entirely.

According to a new estimate from cannabis industry analysts the Brightfield Group, the hemp-CBD market alone could hit $22 billion by 2022. Active cannabis stocks in the markets today include: CROP Infrastructure Corp., Canopy Growth Corporation, Aphria Inc., HEXO Corp. and The Green Organic Dutchman Holdings Ltd.

CROP Infrastructure Corp. recently announced it is developing a new cannabis-infused line of soft drinks which are a zero calorie, non-GMO, ketogenic-friendly line of soda pops, and will include tea and coffee versions. The global carbonated soft drinks market is projected to reach USD 605.6 Billion by 2025, according to a report by Grand View Research, Inc.

CROP Infrastructure Director and CEO, Michael Yorke, stated: “The cannabis-infused beverages market has attracted the attention of world-class beverage companies as legalization spreads. We see it as a tremendous opportunity for CROP Infrastructure’s branding & IP portfolio and as an axillary opportunity for each of our cultivation tenants Globally. We believe that cannabis’s medically known benefits will enhance our own formulations.”

Additional cannabis industry related developments from around the markets:

Canopy Growth Corporation announced that the shareholders of the respective companies have overwhelmingly voted in favor of all matters in connection with the previously announced business combination involving Canopy Rivers and AIM2 that will result in a reverse take-over of AIM2 by Canopy Rivers and will constitute AIM2’s “Qualifying Transaction”. The AIM2 shareholders approved all matters contemplated at the AIM2 meeting including increasing the size of the AIM2 board, the election of all proposed board members, the consolidation of AIM2’s existing common shares on a 26.565 for 1 basis, the implementation of a dual-class voting structure, including the creation of a new class of subordinated voting shares and a new class of multiple voting shares, the name change from AIM2 to “Canopy Rivers Inc.” and the adoption of a new stock option plan. The Consolidation, Name Change and implementation of the Dual Class Voting Structure are expected to be implemented immediately prior to closing of the Transaction. The Transaction is subject to final approval of the TSXV and is expected to close on or about September 17, 2018.

Aphria Inc. announced that it has entered into a wholesale supply agreement with Emblem Cannabis Corp., wholly owned subsidiary of Emblem Corp. and a licensed producer of medical cannabis under the Access to Cannabis for Medical Purposes Regulations, to supply 175,000 kilograms of high-quality cannabis over a five-year period starting May, 2019, with a total of 25,000 kg deliverable for the balance of the first year. Under the terms of the agreement, Aphria will receive a non-refundable deposit of $22.8-million, which comprises $12.8-million in cash and 6,952,169 of common shares of Emblem. The Emblem common shares issued to Aphria are subject to a contractual lockup and standstill arrangement, with five equal releases over the term of the agreement, subject to certain customary exceptions.

HEXO Corp. recently announced it has acquired an interest in a 2,004,000-square-foot facility in Belleville, Ont. This is the first facility of the company to be established outside of Quebec, further delivering on its national expansion strategy and providing capacity for the manufacturing of advanced cannabis products, including cosmetics, vapes, non-alcoholic beverages and other edibles. The centralized location, conveniently located along primary shipping routes in Ontario, presents the opportunity to process and distribute products and to fulfill commitments across Canada. The space also supports the company’s hub-and-spoke model. Its scalability, flexibility and location are ideal to deliver on anticipated future joint ventures with Fortune 500 companies for cosmetics, edibles, vapes and more, positioning it to become a centre of excellence for all of Hexo’s joint ventures. Hexo’s expansion will also lead to the creation of jobs and a rejuvenated employment sector for the area.

The Green Organic Dutchman Holdings Ltd. announced the launch of its premium, certified organic cannabis brand. This preeminent launch coincides with Canadian Organic Week, the largest annual celebration of organic food, farming and products across the country. This is a pivotal step for the Company in becoming the largest, organic cannabis brand in the world. TGOD cannabis adheres to the highest production standards for organic cultivation – the product is grown naturally in Canadian soil, without the use of synthetic pesticides, herbicides or fertilizers. According to a research study, 57% of Canadian medical cannabis consumers and 43% of recreational cannabis consumers prefer organic cannabis. Of 116 licensed producers in Canada, TGOD is one of only two that are certified organic.

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