Cannabis Market Outlook - Forecast Trends, Market Size, Share and Growth Analysis Report 2025-2034

The cannabis market was valued at USD 33.70 Billion in 2024. It is expected to grow at a CAGR of 15.20% during the forecast period 2025-2034. The market is further expected to reach a market value of approximately USD 138.72 Billion by 2034.

The cannabis market is expanding rapidly due to increasing legalization for medical and recreational use. Countries worldwide are recognising the potential benefits of cannabis, leading to regulatory changes that promote market growth. The growing acceptance of cannabis for therapeutic purposes is driving demand, particularly in North America and Europe. The market is also witnessing significant investment in research, product innovation, and marijuana-based pharmaceuticals. Companies are focusing on product diversification to meet the needs of consumers and medical professionals. With more regions exploring cannabis legalization, the market is expected to see sustained growth.

The cannabis plant includes three major species: C. sativa, indica, and ruderalis, each with distinct properties influencing therapeutic and medicinal applications. The growing consumption of these strains for pain management, neurological disorders, and chronic diseases has increased market interest. Pharmaceutical companies are formulating targeted solutions using different cannabis species to enhance therapeutic effectiveness.

Global marijuana legalization is reshaping cannabis cultivation, distribution, and marketing. Countries where marijuana has been decriminalized are experiencing rising consumption for both medicinal and therapeutic applications. The use of hemp-based products is also increasing, influencing diverse industries. Governments are implementing policies to regulate the consumption and trade of cannabis, ensuring safety while fostering economic opportunities in the global market.

COVID-19 Impact

Rising Medical and In-House Cannabis Use During COVID-19 Drives Market Growth

The COVID-19 pandemic significantly influenced the cannabis market, with increased demand for medical and in-house cannabis use. Lockdowns and stress-related health concerns led to a surge in cannabis consumption for therapeutic and recreational purposes. Patients sought medical cannabis for pain relief, anxiety, and sleep disorders, while restrictions on healthcare services encouraged self-medication. Many governments deemed cannabis businesses essential, ensuring continued supply despite disruptions. This shift strengthened market presence and normalized cannabis use in mainstream healthcare.

E-commerce platforms and online dispensaries saw a sharp rise in sales, reflecting changing consumer behaviors. Digital healthcare adoption enabled virtual consultations and cannabis prescriptions, expanding accessibility. Additionally, increased investment in research and product development fueled innovation in medical formulations. As restrictions eased, regulatory bodies reassessed cannabis policies, paving the way for broader legalization. The pandemic accelerated market growth, reinforcing cannabis as a viable option for both medical and wellness applications.

Cannabis Marijuana Market Trends

The cannabis marijuana market is expanding rapidly due to increasing legalization for medical and recreational use worldwide. North America dominates, with the U.S. and Canada driving demand through diverse product offerings and regulatory improvements. Europe is also experiencing growth as more countries approve therapeutic marijuana applications. Investments in cultivation, extraction, and distribution enhance market efficiency. For instance, in November 2024, Tilray Medical launched its first German-grown medical cannabis flowers under Germany’s MedCanG license, improving local access to high-quality medicinal cannabis. Research, innovation, and consumer awareness continue to fuel industry expansion, strengthening global supply chains and market penetration.

The growing acceptance of cannabis marijuana in pharmaceuticals and wellness products fuels demand for diverse applications, including pain management, anxiety relief, and sleep disorders. The development of CBD-infused products and THC-based therapies further strengthens market potential. Moreover, the emergence of digital platforms and online sales channels facilitates easier consumer access, supporting market growth. With increasing government support and changing consumer perceptions, the cannabis marijuana market is expected to witness sustained expansion globally.

Cannabis Marijuana Market Growth Factors

Product Innovation, Unique Offerings, and Growing Availability of Hemp-Infused Edibles Fuel Market Expansion

The cannabis marijuana market is expanding due to continuous product innovation, increasing availability of hemp-infused edibles, and unique offerings catering to diverse consumer preferences. Manufacturers are developing novel cannabis-based products, such as beverages, chocolates, and gummies, to appeal to both medical and recreational users. The rising demand for CBD-infused edibles, known for their therapeutic effects without psychoactive properties, is further boosting market adoption. For instance, in January 2025, Avicanna partnered with Vectura Fertin Pharma, a Philip Morris subsidiary, to enhance medical cannabis understanding in Canada. Their joint Scientific and Medical Affairs Committee will support research, education, and patient access. Avicanna also expanded into European markets, delivering proprietary topical cannabinoid products under an exclusive supply agreement.

With growing consumer interest, companies are investing in advanced extraction techniques to improve product purity and potency. The availability of various THC and CBD concentrations in edibles, catering to specific needs, has also strengthened market growth. Moreover, digital platforms and e-commerce channels facilitate widespread distribution, allowing consumers to explore a range of cannabis marijuana products conveniently, further accelerating market expansion.

Growing Demand for Medical Applications to Accelerate Industry Growth

The increasing recognition of cannabis marijuana for medical applications is a major driver of industry growth. Cannabis-derived products are widely used to manage chronic pain, epilepsy, anxiety, and sleep disorders. CBD and THC-based formulations are gaining traction as alternatives to traditional pharmaceuticals, offering fewer side effects. Governments worldwide are supporting research initiatives and legal frameworks for medical cannabis, further strengthening its market presence. As patient awareness grows, medical cannabis adoption is expected to increase, driving long-term industry expansion.

Restraining Factors

Regulatory Restrictions on Hemp Usage Across Countries to Hinder Market Growth

Stringent regulatory restrictions on hemp usage in various countries pose a significant challenge to market growth. Despite growing awareness of cannabis-derived products, inconsistent legalization policies limit production, distribution, and consumption in several regions. Many governments classify hemp alongside marijuana, imposing strict licensing requirements and restrictions on THC content. Additionally, slow regulatory approvals delay market expansion, creating barriers for businesses.

International trade complexities further hinder market potential, as varying regulations across borders affect cannabis hemp imports and exports. The lack of uniformity in quality standards also impacts consumer trust and product availability. These restrictions continue to challenge market penetration, limiting the growth of hemp-infused products globally.

Cannabis Marijuana Market Segmentation Analysis

By Type Analysis

Flowers/Buds Segment to Lead Market Growth Due to Increasing Consumption

Edibles, including gummies, chocolates, and beverages, dominate the cannabis market, driven by increasing consumer preference for flavoured and smoke-free alternatives. The demand for hemp-infused and CBD-based edibles is expanding due to their therapeutic benefits, longer-lasting effects, and easy accessibility. Innovations in low-dose THC edibles cater to both recreational and medical users, enhancing market growth. The rising trend of cannabis-infused wellness products, such as teas and energy drinks, further accelerates demand.

Capsules are a preferred product type in the cannabis marijuana market, particularly in medical applications, due to their precise dosage, ease of consumption, and longer shelf life. These products are gaining popularity among patients seeking non-smokable alternatives for conditions like chronic pain, epilepsy, and anxiety. Pharmaceutical companies are focusing on developing CBD- and THC-infused capsules for targeted therapeutic benefits. Their discreet nature and consistent formulation contribute to higher consumer acceptance, driving market expansion.

Cannabis concentrates, including oils, waxes, and tinctures, attract experienced users due to their higher potency and fast-acting effects. These products are widely used in vaping devices, contributing to increased market penetration. Additionally, the “others” segment, covering topicals, patches, and transdermal applications, is expanding as cannabis-infused skincare and pain relief solutions gain traction. This diversification strengthens market opportunities across medical and recreational sectors.

By Application Analysis

Recreational Marijuana to Dominate Application Sector Due to Psychoactive Effects

The cannabis marijuana market is broadly segmented into medical and recreational applications, with recreational marijuana leading due to its psychoactive properties. Increasing legalization across North America and Europe has significantly boosted recreational cannabis consumption, allowing users to access high-THC strains legally. The demand for edibles, concentrates, and infused beverages is rising, driven by their convenience and discreet usage. Consumers seek cannabis for relaxation, mood enhancement, and stress relief, further expanding the recreational market.

The medical cannabis segment is also experiencing substantial growth, particularly in the treatment of chronic pain, neurological disorders, and mental health conditions. Patients increasingly turn to CBD-based medical cannabis products, known for their therapeutic benefits without psychoactive effects. Government policies supporting medical cannabis research and prescription-based access enhance market expansion. Pharmaceutical companies and research institutions continue developing cannabis-based therapeutics, driving innovation in this segment.

Despite the dominance of recreational marijuana, medical cannabis remains crucial due to its expanding applications in oncology, epilepsy, and multiple sclerosis treatments. Continuous clinical trials and the integration of cannabis-based medications in healthcare systems contribute to steady market growth. With increasing awareness and physician recommendations, the medical segment is expected to witness sustained expansion.

By Component Analysis

THC-Dominant Products Maintain Strong Market Share Due to High Consumer Demand for Psychoactive Effects and Recreational Use

Among the key cannabis compounds, Tetrahydrocannabinol (THC) dominates due to its psychoactive properties and recreational appeal. Consumers prefer THC-dominant strains for their euphoric effects, making them highly popular in legalized markets. The demand for THC-infused edibles, vapes, and oils continues to rise, reinforcing its strong market position.

In contrast, cannabidiol (CBD) products are expanding within therapeutic and wellness applications, particularly in treating anxiety, pain, and inflammation. CBD’s non-psychoactive nature has led to widespread adoption in nutraceuticals, skincare, and pharmaceuticals, making it a key segment in medical cannabis.

Balanced THC & CBD products are emerging as a preferred choice for consumers seeking a mix of therapeutic benefits and mild euphoria. These formulations are particularly popular among medical users who require symptom relief without excessive psychoactive effects. The balance between THC and CBD ensures versatility in both medical and recreational cannabis markets.

Regional Insights

North America to Lead Market Share Due to Extensive Adoption of Marijuana and Cannabis-Infused Products

North America dominates the market due to the widespread legalization of cannabis in the U.S. and Canada, coupled with increasing consumer demand for medical and recreational use. Favourable regulatory frameworks, strong research initiatives, and the presence of key market players further accelerate industry growth. Expanding product innovations and investment in cannabis-derived pharmaceuticals continue to drive market expansion across the region. For instance, In February 2024, In a study led by the Johns Hopkins University School of Medicine and Tufts University School of Medicine, researchers show that a pill form of the drug dronabinol, an FDA-approved synthetic version of marijuana’s main ingredient, THC, reduces agitation in patients with Alzheimer’s by an average of 30%. The researchers say that compared to current treatments for agitation, such as antipsychotics, dronabinol produced similar calming effects without adverse results such as delirium or seizures.

Europe exhibits significant growth, driven by progressive cannabis regulations and rising medical cannabis adoption. Germany, the UK, and France lead the market due to increasing government approvals and growing awareness of cannabis-based therapies. Expanding research initiatives and pharmaceutical collaborations contribute to market development. Additionally, ongoing clinical trials evaluating cannabis for various medical conditions are expected to enhance market penetration.

Asia Pacific, Latin America, and the Middle East & Africa show emerging opportunities due to evolving regulations and increasing acceptance of cannabis for medical applications. Countries like Australia and Thailand are pioneering the Asia Pacific market, while Latin American nations such as Colombia and Uruguay expand exports. In the Middle East & Africa, growing discussions on legalization and medicinal applications fuel gradual market expansion.

Key Industry Players

Strategic Partnerships and Expansions by Key Players to Drive Market Growth

CannTrust Holdings Inc

CannTrust Holdings Inc. is a Canadian cannabis company known for producing high-quality medical and recreational cannabis products. It focuses on innovative cultivation techniques, research-driven product development, and patient-centered care. Despite regulatory challenges, CannTrust continues to expand its presence in the cannabis industry, leveraging advanced extraction and formulation technologies to enhance product efficacy and consumer accessibility.

VIVO Cannabis Inc

VIVO Cannabis Inc. is a Canadian licensed producer specializing in premium medical and adult-use cannabis. With brands like Canna Farms and Fireside, it focuses on high-quality cultivation, innovative formulations, and patient wellness. VIVO operates state-of-the-art growing facilities and invests in cannabis research, expanding its global footprint while prioritizing sustainable cultivation and consumer education.

Cronos Group Inc

Cronos Group Inc. is a global cannabinoid company focused on innovation, R&D, and premium cannabis brands. With a diverse portfolio, including PEACE NATURALS and Spinach, Cronos leverages cutting-edge biosynthesis technology to develop advanced cannabis products. Strategic partnerships and investments in consumer wellness drive its expansion in the rapidly evolving medical and recreational cannabis markets.

Jazz Pharmaceuticals

Jazz Pharmaceuticals is a biopharmaceutical company integrating cannabis-based therapeutics into its product portfolio. It acquired GW Pharmaceuticals, the developer of Epidiolex, the first FDA-approved CBD treatment for epilepsy. Jazz focuses on cannabinoid-based medicines for neurological disorders, leveraging research-driven innovations to expand cannabis applications in pharmaceuticals while ensuring regulatory compliance and global market expansion.

Other companies in the market include:

• OrganiGram Holdings
• Lexaria Corp.
• ABcann Medicinals, Inc
• Aurora Cannabis Inc
• Tilray Brands, Inc
• Canopy Growth Corporation
• Cresco Labs, LLC
• Ecofibre Ltd
• Green Thumb Industries Inc
• HEXO Operations Inc
• INDIVA Inc
• Maricann Inc

Key Industry Developments

• In October 2024, Releaf, the UK's fastest-growing medical cannabis provider, signed a multi-million-pound contract with Glass Pharms, securing 145kg of medical-grade cannabis. This marks the UK’s largest industry deal, reinforcing Releaf’s market leadership and the sector’s growing maturity.
• In April 2024, the DEA's move to reclassify cannabis as a Schedule III drug signals a shift toward mainstream medical cannabis adoption. This regulatory change could drive market expansion, increasing accessibility and industry growth while reducing legal restrictions on cannabis-based treatments.
• In August 2024, Aurora Cannabis partnered with Vectura Fertin Pharma’s subsidiary, Cogent, to launch a CBD lozenge on Aurora’s Canadian medical platform. This collaboration aims to gather patient feedback, validate product efficacy, and generate real-world data for future market expansion.
• The 2024 Canadian Cannabis Survey highlighted the shifting consumption patterns and market dynamics. Smoking cannabis remains the most common method (69%), but its prevalence is declining. Legal sources now account for 72% of cannabis access, up from 37% in 2019, while illegal sourcing has dropped to 3%.
• In October 2024, Avextra will initiate a Phase 2 trial in Italy to evaluate a cannabis-based oral medication for ALS, Parkinson’s, and Alzheimer’s disease. Approved by Italian health authorities, the three-year NEUROBIS trial aims to explore cannabis’s therapeutic potential in neurodegenerative diseases, strengthening its role in the medical cannabis market.
• A February 2024 study by Johns Hopkins and Tufts University found that dronabinol, an FDA-approved synthetic THC pill, reduced agitation in Alzheimer’s patients by 30%. Unlike antipsychotics, it provided similar calming effects without severe side effects like delirium or seizures, highlighting its potential as a safer alternative for managing agitation.

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