The cannabis concentrate market is hitting an unprecedented high this year, largely driven by the increasing popularity and public acceptance of vaping. A new market report by Arcview Market Research and BDS Analytics has estimated that Americans will spend $2.9 billion on concentrates this year, 49% more than last year. In 2014, concentrates only accounted for 10% of all cannabis sales, but that number is expected to climb to 27% this year.
“As the cannabis industry matures, we’ll likely see new product categories catch fire with consumers,” Arcview CEO Troy Dayton said in a statement, according to Green Market Report. “Concentrates are the first category to do that, but it’s just the beginning of a revolution in how cannabis is consumed now that it’s becoming legal around the world.”
The report estimates that pre-filled vape pens will account for 58% of all concentrate sales this year. “For consumers, [vapes are] a discreet and healthier choice that will likely make cannabis consumers of people who would never dream of inhaling smoke,” Tom Adams, Editor-in-Chief of ArcView Market Research, wrote in the report. “That will cause the category to represent ever more retail display space, and likely spawn vape-only stores and on-premises consumption venues.”
The widespread acceptance of vaping even extends to those who do not use cannabis. A recent survey has found that although most Americans have noticed someone getting high in public, 76% said that encountering someone vaping in public did not bother them at all. Only a small minority of 16% said they would go so far as to notify the police of public vape use. Vaping in enclosed public spaces, like subways or restaurants, remains far less popular, with 80% of respondents expressing their annoyance at this behavior.
New cannabis users find themselves attracted to the consistency and reliability of prefilled vapes, which are able to provide metered doses of specific blends of cannabis products. As the industry matures, producers are constantly creating new concentrates that isolate or combine specific cannabinoids and terpenes for a wide range of medical or recreational benefits. The concentrates market is now growing so fast that sales may eventually challenge the popularity of smokeable flower. By 2022, the report estimates that this market could hit $8.4 billion, while flower is expected to barely hold on to the lead at $8.5 billion.
In the report, Adams explains that the growing concentrate market may also allow cannabis producers to cut their costs over time. “The main savings will be at the agriculture level, where expensive warehouse and greenhouse grows designed to provide pretty buds give way to traditional outdoor growing of a commodity crop,” he wrote. “The cost savings — and broader consumer appeal of concentrates — will prove critical as the legal market struggles under the weight of heavy tax and regulatory loads to compete with the illicit market.”