A Look at The Cannabis Industry
As more states legalize medical marijuana, the U.S. cannabis industry has grown over 200% in the past five years, topping $7.3 billion according to the Here to Stay or Up in Smoke: A Look at the U.S. Cannabis Market white paper and accompanying infographic.
Produced by PMMI, The Association for Packaging and Processing Technologies, the research notes marijuana is legalized at some level in 30 states and is pending further legalization in 14 others. This growth, along with an influx of business startups, has helped legitimize marijuana use in the eyes of many.
By the year 2020, the cannabis industry is expected to reach $24.5 billion, with $11.2 billion for recreational products and $13.3 billion for medical products. While 95% of customers preferred cannabis flowers in 2016, by 2018 only 55% of customers prefer cannabis flowers, instead favoring concentrated, processed cannabis formats.
The inconsistent legal status between state and federal laws is an obvious challenge facing cannabis manufacturers. Other challenges include:
Separate RFID tags for the plant and packaged product
The resistance of financial institutions to work with cannabis companies
Strict FDA regulations
Packaging for cannabis products is highly regulated with requirements for child resistant and resealable lids, tamper evidence and opacity. Formats also vary for the different forms of cannabis, with cannabis flower in glass jars and tubes, concentrates in heatproof, borosilicate, glass or polystyrene containers and edibles in resealable smell proof bags.
Cannabis manufacturers are actively looking for equipment and technology to aid them in implementing new processes, particularly automation. Many opportunities exist to form strong and lasting relationships with these manufacturers – especially for OEMs offering technical guidance who are willing to take on a bit of risk.