Cannabis testing market to reach $2.44bn by 2027

A new report has projected that the cannabis testing market will reach $2.44bn by 2027 at 11.9% CAGR.

In 2019, the global cannabis testing market reached $1.02bn. The new report by Allied Market Research expects the market to hit $2.44bn by 2027, registering a CAGR of 11.9% from 2020 to 2027.

Allied says that a surge in demand for medical cannabis legalisation in several countries, an increase in the adoption of Laboratory Information Management Systems (LIMS), and collaborations between major companies is driving the growth of the market. 

Cannabis testing 

The report shows that North America held the highest share in 2019, generating more than half of the global cannabis testing market. It cites legalisation of cannabis and the availability of instruments, software, and services for cannabis testing as drivers of market growth across the region. However, Latin America, Middle East and Africa (LAMEA) is expected to showcase the fastest CAGR of 14.1% during the forecast period, due to legalisation of medical cannabis and the growing number of cannabis cultivators and testing laboratories in the region. 

High start-up costs for cannabis testing laboratories impede the growth of the market, according to the report, but untapped potential in emerging economies is expected to pave the way for lucrative opportunities in the industry.

COVID-19 has also had a major impact on the market, with the closure of labs, disrupted supply chains, economic slowdown and restricted movement, but, due to relaxations on rules, Allied says the market is expected to revive soon. 

Dominating the market

The cannabis drug manufacturers segment accounted for nearly half of the market revenue in 2019, and the report projects this segment to retain its dominance throughout the forecast period, citing it at a CAGR of 12.4% from 2020 to 2027 due to growing acceptance of medical cannabis and a rise in the number of cannabis-based clinical trials across the world.

Additionally, the report says the consumables segment contributed to nearly three-fifths of the global cannabis testing market share in 2019. This product segment is anticipated to dominate the market by 2027 due to the frequent use of consumables for cannabis testing. 

The report also highlights that the instruments segment is expected to show the fastest CAGR of 13.2% from 2020 to 2027 due to increasing investments by major players in the development of technologically advanced instruments.

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