The global industrial cannabis market has witnessed new growth since Canada legalized cannabis and the United States passed the Hemp Farming Act of 2018.
According to data released by Viridian Capital Advisors, a consulting firm in the hemp industry, global cannabis companies have raised nearly $13.8 billion in 2018. The industrial hemp part in the world’s major stock markets soars, and the continuous rise of the cannabis index becomes common.
Moreover, with the rapid increase of CBD users, CBD products get popular in the consumer market. It seems that more and more enterprises begin to invest and strengthen themselves in the CBD market.
CBD market potential is great according to the change of the giant enterprises
According to the Associated Press, Altria Group, the world’s largest tobacco company, bought 45% of Cronos Group, a well-known Canadian cannabis listed company, with $1.8 billion, and they might increase its stake to 55% in the next five years.
The food and beverage giants, such as Coca-Cola, Heineken, Budweiser and Constellation Group have also made great efforts to develop the CBD market and developed many foods and beverages containing CBD in 2018. According to various sources compiled by Canadian media BNN Bloomberg Television, Coca-Cola is very interested in developing beverages containing CBD ingredients.
Coca-Cola admits that they develop hemp drinks because CBD cola can relieve inflammation, pain and spasm. In response to media emails, the company also explained, “We are paying close attention to the growth of non-psychoactive CBD as a component of functional health drinks worldwide. This field is developing rapidly.
In addition, according to the Washington Times, senior executives of retail giants such as Walmart and Target have recently met quietly with manufacturers of beverages, fudge, topical creams and CBD oils.
In fact, this is not the first time Walmart was reported to set foot in the cannabis field. In October last year, Walmart’s Canadian company announced that it was exploring the possibility of selling CBD-containing products in stores in Canada. Although Wal-Mart spokesman Diane Medeiros said they would not sell any CBD products until full legalization, it continued to drive up Walmart’s share price after the news of the day.
Since then, Wal-Mart has announced a partnership with New Age Beverages Corporation, a health functional beverage company, to sell its three new beverage combinations in all retail stores in the United States.
Although Walmart repeatedly emphasized that the three products on sale would not involve CBD components, investors and the market remained optimistic, and the industry also said that the cooperation with New Age Beverage Company at this time might be the preparation for Walmart’s CBD products to be listed in the future.
Due to the huge medical value and market space of CBD products, senior consultants of ARCVIEW Group have evaluated CBD industry, and the market size of CBD is expected to reach 22 billion US dollars by 2022.
According to market research firm ARCVIEW, legitimate cannabis sales in North America reached about $7 billion in 2016, and sales are expected to grow at an average annual rate of 27% over the next five years, reaching $22.6 billion by 2021.
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Growing CBD demand promotes Chinese CBD device manufacturing growth
On the other hand, industrial cannabis may still be a sensitive topic in the world, but with the introduction of many studies, not only the food retail giants and investors are optimistic about the development prospects of the industry, but also the manufacturing of CBD device will be boosted.
Compared with the traditional “flower” and “paste”, CBD oil is not only simpler and more convenient to use, but also can achieve the same effect. Because of this reason, the demand for CBD device in Europe and America has increased greatly, and China domestic suppliers of CBD atomization products & vapes have been actively sought.
We contacted CBD-related enterprise VELXtech recently, which is founded in Xixiang, Shenzhen in August 2018, is an innovative atomization technology solution supplier integrating strong technical foundation, high-end factory, perfect production system and quality control system, providing innovative, safe and effective atomization technology, device and related solutions for overseas CBD legal areas.
VELX tells us that the main reason why CBD device can develop at a high speed is that CBD not only has been proved to have an effective therapeutic effect on spasm, anxiety, inflammation and pain in a certain range of quantities, but also has an explosively growing user group with the demand increasing day by day“.
VELX, as early as its inception, took innovative CBD atomization technology development as the main direction, and completed VELX atomization technology by independent research and development. Based on this technology, VELX also develop a variety of its own new technical products, such as atomizers, batteries, disposable atomizing device, pod systems, etc. Moreover, they provide customized OED, ODM services and CBD technology solutions to the growing European and American CBD market.
In fact, VELX is a subsidiary company of Geekvape. As the company has six supply chain subsidiaries, it has great advantages in production, research and manufacturing, so it is easier to control product details, information transmission, quality consistency and so on.
VELX has established a strong core team for the development of CBD market, including R&D experience leaders in atomization technology field for many years, sales leaders who are good at the management and service of large overseas customers and the operation of fo overseas projects, and design teams who have been awarded the German Red Dot Award and if Design Award.
VELX stressed that although the production of any type of CBD oil is prohibited in China, the future prospects are still good from the perspective of device development. After all, most of the core technology of CBD devices comes from the electronic cigarette. For enterprises with a deep foundation of electronic cigarette manufacturing, the legitimacy of CBD only means business transformation and increased opportunities to enter the market.
VELX atomization technology has been used in many of the company’s products, and VELX passed relevant tests after the introduction of California Heavy Metals Act on CBD device. On the other hand, VELX has also developed a highly adaptable Prism battery based on the characteristics of CBD oil to enable customers to have a better CBD experience.
Though the long development cycle of CBD device needs a lot of trial and error, VELX team has reached a considerable level in research and development. As long as customers feedback a specific issue, the company can quickly put forward improvement plans according to customer needs, and accurately grasp the needs in use to provide most accurate and useful technical services for customers.
VELX said, “Technology research and development and high quality production are the foundation of VELX. On this basis, we will develop new products, technologies and other products related to this field, and become a trustworthy brand of CBD innovative atomization technology in the cannabis industry.”
Since the end of 2018, the United States passed the Agricultural Amendment Act, which removed industrial cannabis from the Controlled Substances Act, CBD industry has witnessed an unprecedented wave of growth. However, with the rising trend slowdown of traditional retail sales, the retail market has been constantly impacted. Food enterprises have to solve the current dilemma and actively embrace the new consumer market.
Although retailers are less likely to make high profits from CBD, consumers have shown strong willingness to consume CBD products, no matter from CBD oil, CBD device, functional drinks or other related categories. And there is a demand, there is a market. If there is no future for CBD development, VELX will not rush into the CBD field.
In addition, according to the financial report of Canadian cannabis producer Tilray for the first quarter of 2019, its revenue in the first quarter of 2019 was $23 million, rising nearly 195% compared to the same period last year. This shows that the growth momentum of CBD has not slowed down, and the action of the relevant enterprises to enter the CBD market is after good consideration and preparation.
Compare to the new brand VELX, ALD GROUP has been the number 1 for over 10 years in the CBD device manufacturing industry. And the invisible king of the CBD device should be titled to ALD without any doubt. Click below to see more about ALD:
Approaching the “Invisible King” of Electronic Cigarette Enterprises