Cash registers and profit margins are ringing in the cannabis packaging sector. As per market research, it is estimated to grow at a CAGR of 24.3 percent globally from 2021 to 2026 and is expected to see significant growth in the coming years. The expected increase is due to increased consumer demand for medical and recreational cannabis products. And the growing legalization of cannabis in various nations – similar to what is happening in the US – is certain to continue.
Legal, recreational cannabis, which has seen tremendous growth in recent years, is likely to be a big driver for the packaging business. According to the Marijuana Business Daily, “flower” – the plant matter, often known as “buds” – is the most popular type of cannabis marketed in the US. Jars or flexible packaging are commonly used for packaging flowers.
The growing legalization of cannabis consumption in the United States and the overall legal environment in Canada is expected to create ancillary demand for cannabis packaging throughout North America. In the United States, 36 of the 50 states allow patients with a valid prescription to use medical cannabis. Meanwhile, recreational marijuana is now legal in 19 states, the District of Columbia, and Guam. It has lately been decriminalized in 13 more states and the US Virgin Islands.
Because of the numerous rules imposed by different localities, weed packaging is a critical industry component. Cannabis comes in a variety of forms. Oils, extracts, foods, topicals, and beverages are becoming increasingly popular in addition to the flower above. Gummies, chocolates, pastries, and sauces are just a few examples of delicacies competing for market share.
One significant trend in the marijuana packaging market is to capitalize on the growing popularity of recreational cannabis among the younger generation. According to Research and Markets, because of high brand saturation among cannabis businesses, packaging plays a critical role in establishing and strengthening brand image among smaller and developing players.
The company also claims that the national lockdowns imposed during the Covid-19 outbreak boosted demand for cannabis. “As the general idea of storing up on cannabis products in fear of scarcity became popular, multiple retail establishments saw a surge in foot traffic.” According to Research and Markets, “statistics predict that retail sales of cannabis goods will expand rapidly in March 2020, creating an ancillary demand for cannabis packaging items.”
The focus on sustainability, laws and branding has had a significant impact on weed packaging, facilitating the transition from conventional techniques of processing and packaging, which relied on manual labor, to more sophisticated, automated methodologies. As firms become more aware of the benefits, automation is steadily gaining popularity in the cannabis packaging market. The business predicts that as the legal picture for cannabis becomes more uniform, this will become more popular.
Label and package firms are investing R&D resources to provide products and services to suit this new demand, owing to the industry’s expansion and change. Cannabis companies now have market-specific solutions for aesthetics, functionality, and regulatory compliance.
It’s past time to examine some of these vendors, as well as the most recent developments, challenges, and trends affecting the cannabis label and package sector.
Plastic packaging has a sizable share of the market.
Different cannabis consumption forms, such as tinctures, flowers, oils, patches, and pills, have traditionally been packaged in plastic. Plastic has the ability to handle the various obstacles that cannabis producers face.
Plastic is the most prevalent material type used for cannabis packaging for a variety of reasons, including the rigorous cannabis packaging regulatory environment and product preservation. To begin with, cannabis is a perishable commodity, and plastic wrapping enhances the shelf life of perishable products significantly. Second, using sustainable materials to develop child-resistant locking systems is quite difficult. Every legal cannabis market requires some type of child-resistant packaging, whether it’s the primary product-touching layer or a second layer like an escape bag.
Plastic is employed in the containers, droppers, and caps of cannabis-infused extracts and tinctures. The low weight of plastic has been a driving element in the development of plastic containers. Because the packaging containers are so small and only come in 15 to 30 mL sizes, producers are unable to include regulatory information on the labels. The container is frequently packaged with a pamphlet with the required information by the producers in a carton-based secondary packaging.
High-density polyethylene (HDPE), low-density polyethylene (LDPE), polypropylene (PP), and polyethylene terephthalate (PET) bottles and closures have become commonplace in the cannabis market. There is a large assortment of plastic bottles and closures to pick from. Furthermore, several forward-thinking plastic packaging firms are working hard to develop alternatives to fossil-fuel-based plastics, such as sugarcane-based polymers. HDPE Bioresin, which is made from sugarcane resin that is sustainably supplied, is one environmentally favorable choice.
Furthermore, the flexible pouches can comply with the strict weed packaging rules. Due to their low-cost products and the lack of significant players, Chinese vendors have been able to monopolize the flexible packaging industry. Players, including Amcor, have stayed away from the cannabis sector due to the ambiguous legal landscape.
North America has a large market share.
The cannabis sector in North America is one of the most important in the world. The widespread use and production of cannabis in countries like the United States and Canada are credited with the region’s growth.
More people are utilizing medicinal cannabis to treat ailments including chronic pain, depression, PTSD, social anxiety, cancer, multiple sclerosis, and epilepsy, many of which are linked to changing lifestyles, thanks to a recent shift in the legal landscape. Furthermore, as a result of the execution of these harsh rules, suppliers must follow rigorous safety control procedures and supply high-quality products to consumers, boosting the market growth in this region.
California’s current requirements, for example, require that the product be placed in either a child-resistant container or a CR exit packaging. According to new legislation that took effect in January 2020, all products must be packaged in a certified child-resistant container. Furthermore, the edible products must be packaged in re-sealable, child-resistant packaging.
Furthermore, the California Office of Environmental Health Hazard Assessment (OEHHA) approved the listing of “cannabis smoke” and THC as reproductive toxins under Proposition 65 in January 2020, and cannabis vendors in the state will be required to label their products with a Prop 65 warning label within one year.