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Sales of Cannabis Growing Supplies Expand at Fast Pace, in Line with Canadian Hemp & Marijuana Outputs
In October 2018, the Cannabis Act legalized adult-use (i.e., nonmedical, recreational) marijuana in Canada and supplanted previous regulatory regimes for medical marijuana and industrial hemp. As legal operations continue to develop nationwide and federally licensed production expands to meet demand, significant sales opportunities will arise for suppliers of the consumables and equipment used in federally licensed production of hemp and marijuana.
As a result, the Canadian market for cannabis growing supplies is expected to expand 11.7% per year to US$1.8 billion in 2023. Cannabis (i.e, hemp and marijuana) production will expand at the same yearly rate and be the primary driver of sales gains. Also boosting sales will be:
- rapid growth in federally licensed marijuana production – which generates higher-value sales than hemp operations – supported by the formation of legal retail markets at the provincial level under the Cannabis Act
- expanding opportunities for hemp producers stemming from rising consumer interest in CBD-infused food, beverages, supplements, and other products
Key Findings in the Cannabis Growing Market Study:
Robust Expansion in Commercial Marijuana Production to Drive Sales
Robust anticipated expansion in marijuana production volume of 30% per year will drive gains for cannabis growing supplies. Despite accounting for a marginal share of cannabis production volume, marijuana operations represent nearly half of production value:
- While hemp is relatively inexpensive to produce, marijuana operations are most likely to operate indoors and require complex and expensive supplies.
- Particularly high marijuana production activity in British Columbia and Ontario supports high market values.
- Nevertheless, the hemp-focused markets of Alberta and Saskatchewan will continue to lead the growing supplies market based on their output volumes.
As regulated commercial marijuana markets continue to develop nationwide, demand will expand for supplies such as hydroponic equipment, high-intensity grow lights, HVAC equipment, and specialty soil amendments. However, because most equipment types have long lifespans, demand for consumables – an ongoing seasonal need – will grow faster.
Rising Demand for CBD Is Spurring Sales of Hemp Growing Supplies
The emerging market for health products, cosmetics, pet supplements, and other goods infused with cannabidiol (CBD) enabled by the 2018 Cannabis Act is creating major new opportunities for Canadian hemp producers and even inspiring food and beverage firms such as BevCanna to invest in hemp capacity. As hemp production expands nationwide, sales of related seeds, irrigation systems, security equipment, and other products are projected to rise at a fast pace. However, since hemp is typically grown outdoors, the need for some high-value equipment (e.g., lighting and hydroponic grow systems) is limited.
Alberta & Saskatchewan Lead in Consumables & Equipment Demand for Cannabis Production
Alberta will remain the leading Canadian market for cannabis growing supplies, supported by high hemp output and comprehensive regulation of adult-use retail markets, which has enabled accelerated growth of its cannabis industry compared to other provinces. Based on its extensive existing hemp capacity and low marijuana production levels, Saskatchewan will remain the second largest market while advancing at the slowest pace of any province.
Study Coverage
This Freedonia industry study analyzes the US$1.2 billion Canadian cannabis growing market – including consumables and equipment used to grow hemp and marijuana. The study presents historical demand data for 2018, and forecasts for 2019, 2023, and 2028 by product type (seeds & clones; growing media; fertilizers & nutrients; other consumables; water tanks, irrigation, & hydroponic equipment; fans & HVAC equipment; security equipment; lighting systems & bulbs; pots & planters; harvesting & trimming equipment; cloning equipment; other equipment). Demand is also segmented by market (commercial, private-use residential); growing system type (soil-based; hydroponic); and Canadian province (Alberta, British Columbia, Manitoba, New Brunswick, Ontario, Quebec, Saskatchewan). In addition, the study provides historical production data for 2018, and forecasts for 2019, 2023, and 2028 for Canadian hemp and marijuana in dry pounds (further segmented by operation type) and value (further segmented by application). This report also features a detailed overview of the regulatory environment, including up-to-date analysis of federal and provincial regulations regarding production, access, possession, use, and sale of industrial hemp, CBD products, medical marijuana, and adult-use marijuana.
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Table of Contents
EXECUTIVE SUMMARY
CANNABIS MARKET OVERVIEW & PROSPECTS
Cannabis Definition & Scope
Cannabis Applications
Medical Marijuana
Adult-Use/Recreational
CBD & Other Hemp-Derived Products
Growth Opportunities
Market Threats
National Regulatory Environment
2018 Cannabis Act: Legalizing Cannabis for All Uses
Industrial Hemp Regulations
Legal Status of Cannabidiol (CBD) Products
CANNABIS PRODUCTION
Key Findings
Cannabis Supply Chain
Marijuana vs. Hemp
Production Outlook (Pounds)
Production by Cannabis Type
Production by Province
Cannabis Production Value by Application
CANNABIS CONSUMABLES & EQUIPMENT
Key Findings
Products
Demand by Product
Consumables
Equipment
Markets
Demand by Market
Commercial
Private-Use Residential
Growing Systems (Soil-Based & Hydroponic)
MARKET TRENDS BY PROVINCE
Key Findings
Cannabis Growing Market by Province
Provincial Profile: Alberta
Cannabis Growing Market Size & Regulatory Environment
Demand by Product (Consumables & Equipment)
Provincial Profile: Saskatchewan
Cannabis Growing Market Size & Regulatory Environment
Demand by Product (Consumables & Equipment)
Provincial Profile: Ontario
Cannabis Growing Market Size & Regulatory Environment
Demand by Product (Consumables & Equipment)
Provincial Profile: British Columbia
Cannabis Growing Market Size & Regulatory Environment
Demand by Product (Consumables & Equipment)
Other Provinces & Territories
Cannabis Growing Market Size & Regulatory Environment
Demand by Product (Consumables & Equipment)
APPENDIX
Scope
Definitions
Abbreviations
Freedonia Methodology
Study-Specific Methodology
Sources
Associations & Agencies
Related Studies & Reports
Macroeconomic Assumptions
List of Tables
CANNABIS MARKET OVERVIEW & PROSPECTS
Table 2-1 | 2018 Cannabis Act: Key Federal Adult-Use Provisions & Restrictions
Table 2-2 | Industrial Hemp: Number of Licenses Issued & Registered Hectares by Province, 2018
CANNABIS PRODUCTION
Table 3-1 | Canada Cannabis Production by Cannabis & Operation Type, 2018 - 2028 (million pounds)
Table 3-2 | Canada Cannabis Production by Province, 2018 - 2028 (million pounds)
Table 3-3 | Canada Cannabis Production by Application, 2018 - 2028 (billion US dollars & billion Canadian dollars)
CANNABIS CONSUMABLES & EQUIPMENT
Table 4-1 | Cannabis Growing Demand for Consumables & Equipment, 2018 - 2028 (million US dollars)
Table 4-2 | Consumables for Cannabis Growing: Demand by Product, 2018 - 2028 (million US dollars)
Table 4-3 | Equipment for Cannabis Growing: Demand by Product, 2018 - 2028 (million US dollars)
Table 4-4 | Commercial & Private-Use Residential Growers: Consumables & Equipment Demand by Market, 2018 - 2028 (million US dollars)
Table 4-5 | Commercial Market: Consumables & Equipment Demand by Product, 2018 - 2028 (million US dollars)
Table 4-6 | Private-Use Residential Market: Consumables & Equipment Demand by Product, 2018 - 2028 (million US dollars)
Table 4-7 | Cannabis Growing: Consumables & Equipment Demand by System Type & Market, 2018 - 2028 (million US dollars)
MARKET TRENDS BY PROVINCE
Table 5-1 | Consumables & Equipment for Cannabis Growing: Demand by Canadian Province, 2018 - 2028 (million US dollars)
Table 5-2 | Alberta: Cannabis Growing Supplies Demand by Product, 2018 - 2028 (million US dollars)
Table 5-3 | Saskatchewan: Cannabis Growing Supplies Demand by Product, 2018 - 2028 (million US dollars)
Table 5-4 | Ontario: Cannabis Growing Supplies Demand by Product, 2018 - 2028 (million US dollars)
Table 5-5 | British Columbia: Cannabis Growing Supplies Demand by Product, 2018 - 2028 (million US dollars)
Table 5-6 | Other Provinces & Territories: Cannabis Growing Supplies Demand by Province, 2018 - 2028 (million US dollars)
Table 5-7 | Other Provinces & Territories: Cannabis Growing Supplies Demand by Product, 2018 - 2028 (million US dollars)
APPENDIX
Table 6-1 | Relevant Industry Codes
Table 6-2 | Relevant NACE Codes
Table 6-3 | Relevant HS Codes
Table 6-4 | Abbreviations & Acronyms Used in Study
Table 6-5 | Canada: Key Indicators for Cannabis Growing Products Demand, 2008 - 2028 (billion US 2017 dollars)
List of Figures
EXECUTIVE SUMMARY
Figure 1-1 | Key Trends in the Canadian Market for Cannabis Growing Supplies
CANNABIS MARKET OVERVIEW & PROSPECTS
Figure 2-1 | Applications for Hemp
CANNABIS PRODUCTION
Figure 3-1 | Canada Cannabis Production
Figure 3-2 | Cannabis Supply Chain
Figure 3-3 | Canada Commercial Cannabis Production: Marijuana & Hemp Production, 2018 - 2028 (million pounds)
Figure 3-4 | Canada Cannabis Production by Market, 2018 - 2028 (million pounds)
Figure 3-5 | Canada Cannabis Production by Province, 2018 - 2028 (million pounds)
Figure 3-6 | Canada Cannabis Production Share by Application, 2019 (billion US dollars)
CANNABIS CONSUMABLES & EQUIPMENT
Figure 4-1 | Key Trends in Cannabis Growing Consumables & Equipment
Figure 4-2 | Consumables & Equipment Demand for Cannabis Growing, 2018 - 2028 (million US dollars)
Figure 4-3 | Consumables: Selected Product Examples
Figure 4-4 | Consumables for Cannabis Growing: Demand by Product, 2016 - 2028 (million US dollars)
Figure 4-5 | Equipment: Selected Product Examples
Figure 4-6 | Equipment for Cannabis Production: Demand by Product, 2018 - 2028 (million US dollars)
Figure 4-7 | Commercial & Private-Use Residential Markets: Product Mix Comparison, 2019 (million US dollars)
Figure 4-8 | Commercial & Private-Use Residential Markets: Cannabis Growing Supplies Demand Share by System Type, 2019 (million US dollars)
MARKET TRENDS BY PROVINCE
Figure 5-1 | Key Trends in Canadian Provincial Markets for Cannabis Growing Supplies
Figure 5-2 | Cannabis Growing Supplies Demand by Canadian Province, 2018 - 2023 (million US dollars)
Figure 5-3 | Alberta: Regulatory Highlights
Figure 5-4 | Alberta: Cannabis Growing Supplies Market & Cannabis Production, 2018 - 2028 (million US dollars & million pounds)
Figure 5-5 | Alberta: Cannabis Growing Supplies Demand Share by Product, 2019 (million US dollars)
Figure 5-6 | Saskatchewan: Regulatory Highlights
Figure 5-7 | Saskatchewan: Cannabis Growing Supplies Market & Cannabis Production, 2018 - 2028 (million US dollars & million pounds)
Figure 5-8 | Saskatchewan: Cannabis Growing Supplies Demand Share by Product, 2019 (million US dollars)
Figure 5-9 | Ontario: Regulatory Highlights
Figure 5-10 | Ontario: Cannabis Growing Supplies Market & Cannabis Production, 2018 - 2028 (million US dollars & million pounds)
Figure 5-11 | Ontario: Cannabis Growing Supplies Demand Share by Product, 2019 (million US dollars)
Figure 5-12 | British Columbia: Regulatory Highlights
Figure 5-13 | British Columbia: Cannabis Growing Market & Cannabis Production, 2018 - 2028 (million US dollars & million pounds)
Figure 5-14 | British Columbia: Cannabis Growing Supplies Demand Share by Product, 2019 (million US dollars)
Figure 5-15 | Other Provinces & Territories: Cannabis Growing Supplies Market & Cannabis Production, 2018 - 2028 (million US dollars & million pounds)
Figure 5-16 | Other Provinces & Territories: Cannabis Growing Supplies Demand Share by Product, 2019 (million US dollars)
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