Global Hemp Extracts Market - 2024-2031

Overview

Global Hemp Extracts Market reached US$ 3.5 billion in 2023 and is expected to reach US$ 6.20 billion by 2031, growing with a CAGR of 7.41% during the forecast period 2024-2031.

Hemp extract, derived from the entire hemp plant, contains a variety of phytocannabinoids, including cannabidiol (CBD), terpenes, flavonoids and over 400 other naturally occurring chemical compounds. Many consumers believe these compounds work synergistically to enhance the therapeutic benefits of CBD, contributing to the widespread appeal of hemp-based products. Increasing consumer demand for natural wellness products expands the market growth.

Regulatory changes are also paving the way for greater market access and growth. With the legal status of hemp products evolving, particularly in North America and Europe, opportunities for large-scale cultivation, production and distribution are expanding. For instance, in November 2020, the EU Court of Justice ruled that legally produced CBD can be marketed in the EU, as it is not considered a narcotic, provided it meets EU legal requirements.

Hemp's environmental benefits, such as carbon sequestration, soil health improvement and low pesticide use, align with the EU's sustainability goals, giving Europe a competitive edge in the global market. With strong regulatory support, innovation and growing consumer demand for eco-friendly products, Europe is leading in hemp cultivation and product development, solidifying its dominance worldwide.

Dynamics

Shift Toward Healthier, Eco-Friendly Alternatives

The growing shift toward plant-based and natural ingredients drives substantial growth in the hemp extract market, fueled by rising consumer demand for healthier, eco-friendly alternatives across various industries. As awareness about the potential health benefits of natural ingredients increases, consumers are gravitating toward hemp-based products for wellness, skincare and beauty routines.

Hemp extracts, particularly CBD, are gaining popularity due to their perceived ability to manage conditions like anxiety, inflammation and skin irritation without the use of synthetic chemicals. Additionally, as consumers prioritize sustainability, hemp's eco-friendly cultivation practices, including its minimal need for water and pesticides, make it an appealing choice for those seeking environmentally conscious products.

The trend is further accelerating the market in sectors such as food and beverages, personal care and nutraceuticals, where hemp extract is incorporated into a wide range of products. In the beauty industry, hemp oils, tinctures and CBD-infused lotions and balms have become staples due to their potential to improve skin health and provide anti-aging benefits. As more consumers seek natural, cruelty-free and vegan options, hemp-based formulations align perfectly with these ethical and health-conscious values.

Advancing Extraction Technology

The global hemp extract market is rapidly expanding, driven by the growing demand for high-quality cannabidiol (CBD) and other hemp-derived products. The extraction process is a critical stage that directly impacts both yield and purity. With over 500 natural compounds in Cannabis sativa L., the choice of extraction method among supercritical fluid extraction, microwave-assisted extraction or mechanical pressing greatly influences the efficiency, cost-effectiveness and final product quality.

Approximately about 60% of cannabinoids are lost during extraction, selecting the right technology is key to maximizing returns in this high-value industry. With numerous extraction methods available, producers are continuously looking for the most efficient and sustainable options. Advanced techniques such as ultrasound-assisted extraction and supercritical fluid extraction offer superior yield and purity, meeting the rising market demand for potent hemp extracts.

Cost and Pricing Concerns

The high cost of hemp extracts is a significant restraint on the global market, with premium products like CBD oils, tinctures and isolates being particularly expensive due to the costs of raw materials, sophisticated extraction techniques and extensive quality testing. These expenses are often passed down to consumers, making hemp-based products less accessible to a broader demographic.

In regions where economic conditions are strained or where consumers have limited understanding of the benefits of hemp extracts, the high price point creates a barrier to widespread adoption, as many consumers view these products as a luxury or non-essential. Additionally, the cost issue is exacerbated in markets with lower disposable incomes, where affordability becomes a critical factor in purchasing decisions.

Segment Analysis

The global hemp extracts market is segmented based on type, source, extraction method, distribution channel, application and region.

Highly Versatile Nature of CBD Isolates

The global hemp extract market is segmented based on type into full-spectrum, broad-spectrum and CBD isolates. The CBD isolate is the dominant segment due to its exceptional purity and potency. As a 99% pure crystalline powder, CBD isolate offers the highest concentration of CBD, appealing to consumers seeking precise, controlled doses for therapeutic use. Its neutral taste and odor make it highly versatile, allowing easy incorporation into various products without altering their flavor profile.

Additionally, its zero THC content makes it the preferred choice for those concerned with legal issues, drug testing or personal preference to avoid psychoactive effects. It is popular for its high potency and targeted effects, offering pure CBD without other cannabinoids or terpenes. Its accessibility in regions with strict cannabis laws and demand for customizable, cost-effective products help it maintain dominance in the growing hemp extract market.

Geographical Penetration

High Hemp Cultivation in Europe

Europe is rapidly becoming a dominant force in the global hemp extracts market, driven by significant growth in hemp cultivation, strong regulatory frameworks and rising demand for hemp-based products. From 2015 to 2022, the area dedicated to hemp cultivation in the EU grew by 60%, from 20,540 hectares to 33,020 hectares, while production surged by 84.3%, reaching 179,020 tonnes, according to the European Commission.

France is the largest producer, accounting for over 60% of the EU's hemp output, followed by Germany (17%) and The Netherlands (5%). This increase in hemp production is driven not only by the demand for fiber but also by the rising global need for hemp extracts, particularly CBD, used in wellness products, cosmetics and food. The EU's clear regulatory guidelines, which focus on low-THC varieties and ensure high product quality and safety, have established a trusted and competitive market environment.

Europe's regulatory support, coupled with strong agricultural innovation, has fostered a robust infrastructure for efficient production and processing of hemp extracts. With investments in research and development, particularly in countries like France and Germany, Europe has cemented its position as a leader in hemp production and processing, poised to meet the growing global demand for hemp-derived products.

Competitive Landscape

The major global players in the market include Cannavedic Private Limited, GVB Biopharma, Superior Supplement Manufacturing, Qurist, Hemp Health Private Limited, Cannarma, Beyond Botanicals LLC, Phasex Corporation, Treadwell Farms, Hempstrol and Arvanna LLC.

Russia-Ukraine War Impact

The Russia-Ukraine war has disrupted global hemp extract supply chains, especially in Europe, where producers face challenges in sourcing raw materials. Sanctions on Russia have reduced its hemp exports, while Ukraine's agricultural sector, known for hemp cultivation, has been severely impacted. This disruption has led to price volatility, especially for high-demand products like CBD.

In response, manufacturers are diversifying their sourcing strategies, shifting to markets like US and Canada, which are seeing increased demand for hemp extracts. The conflict has also spurred investments in local production and self-sufficiency, fostering more resilient supply chains. This shift is driving innovation and intensifying competition, leading to a more diversified global hemp market.

By Type

• Full-spectrum
• Broad-spectrum

By Source

• Flowers
• Leaves
• Stalks

By Extraction Method

• CO2 Extraction
• Solvent-Based Extraction
• Steam Distillation
• Cold-Press Extraction

By Distribution Channel

• Supermarkets/Hypermarkets
• Specialty Stores
• Pharmacies
• Online Retail

By Application

• Food & Beverages
• Pharmaceuticals
• Personal Care & Cosmetics
• Nutraceuticals
• Animal Care
• Others

By Region

• North America
  • US
  • Canada
  • Mexico
• Europe
  • Germany
  • UK
  • France
  • Italy
  • Rest of Europe
• South America
  • Brazil
  • Argentina
  • Rest of South America
• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • Rest of Asia-Pacific
• Middle East and Africa

Key Developments

• In June 2024, DSM-Firmenich launched CBtru, a CBD drug intermediate that enables higher drug loading and better bioavailability for oral forms like tablets and chewables, improving convenience and patient-friendliness.
• In June 2024, NOW Solutions launched three new CBD topicals: CBD Joint & Muscle Cream, CBD Balm and CBD Massage Oil. These products are formulated with broad-spectrum hemp extract and a blend of botanical ingredients to support muscles, joints and skin.
• In November 2023, Modicare Limited introduced the Hemp Lab skincare range, featuring a 5-step regimen with natural actives from Europe. Backed by 3 years of research, this range harnesses the power of hemp to repair, balance and rejuvenate your skin.

Why Purchase the Report?

• To visualize the global hemp extracts market segmentation based on type, source, extraction method, distribution channel, application and region, as well as understand key commercial assets and players.
• Identify commercial opportunities by analyzing trends and co-development.
• Excel data sheet with numerous data points of the hemp extracts market-level data points with all segments.
• PDF report consists of a comprehensive analysis after exhaustive qualitative interviews and an in-depth study.
• Product mapping available as excel consisting of key products of all the major players.

The global hemp extracts market report would provide approximately 78 tables, 79 figures and 208 pages.

Target Audience 2024

• Manufacturers/ Buyers
• Industry Investors/Investment Bankers
• Research Professionals
• Emerging Companies