An Overview of the Pet CBD Industry
The Pet CBD Industry is booming.
Cannabidiol (CBD), a naturally occurring substance found in cannabis plants, is increasingly being used in health and dietary supplements, not only for humans but for animals as well. Although CBD is an integral part of the cannabis plant, it contains no addictive, psychoactive components. Growing and producing hemp CBD have been legal in the United States since the signing of the 2018 Farm Bill.
A recent CNBC article highlights the fact that some of the biggest users of CBD aren’t even human: In fact, pet dogs and cats are increasingly using this product as their loving owners seek to provide relief from anxiety, aches and pains, and other medical and behavioral conditions affecting their four-legged friends.
Growth rates in the CBD market are burgeoning. Sales are expected to grow, not only in the US, but also around the world. According to a Forbes report, hemp-based CBD products for pets will make up 3% to 5% of the total sales of hemp CBD by 2025.
Market Trends in the Pet CBD Industry
Today’s pet owners increasingly tend to look at their animals as their children or as equal members of their families. A recent piece by Pet Product News reported that “Pet owners’ accelerated acceptance of CBD pet products combined with a better understanding of how these products work has led to an influx of products available on the market—including oils, chews, pills, and creams—to meet demand”.
This has consequently fueled CBD sales. Sales of CBD products for pets could increase to $1.16 billion in the U.S. alone by 2022, according to the Brightfield Group research firm.
The CBD industry is still quite new. One key trend is the increase in scientific research on the detailed workings of CBD in animals. Up to now, most information has been anecdotal, although increasing numbers of pet owners are happy with the results. Early research suggests that in mammals, CBD interacts positively with many bodily functions, especially including the digestive and cardiovascular systems. Additionally, research is focused on CBD’s role in promoting relaxation and improving cognition.
Another trend that is expected, but not quite manifested yet, is the projected decrease in the number of companies offering pet CBD products. According to Chelsea Gennings, co-founder of the firm Pet Relief: “… Five years from now, you will not see about 80 percent of the companies that are on the market right now. The rules and regulations coming out will make the hemp world a much higher barrier of entry compared to what it is right now.”
Although scientific studies are in their infancy, the wide and varied effectiveness of CBD for pets is illustrated in the following anecdotal case studies, gleaned from a recent article by Sarah Sypniewski:
- A 7-year-old Great Dane-Akita mix had terrible stomach problems since he was brought home from the animal shelter at 2 months old. Over the years, thousands of dollars were spent to remedy the situation to no avail. CBD oil treatment ”totally changed everything”. The pet no longer vomits or had diarrhea.
- Ten-year-old Cubbie is a pet dog who was terribly frightened of loud noises such as fireworks or thunder. Anxiety medications supplied by the veterinarians did little to help. Things improved for Cubbie when his owner learned about CBD oil. Even a huge thunderstorm didn’t adversely affect him after CBD oil was administered.
Key Companies in the Pet CBD Space
Numerous companies produce CBD. Many of these are small outfits attempting to cash in on the trend. The largest of the CBD manufacturers in the US, with market capitalizations in parentheses, are CV Sciences ($45.7 Million), Gaia Herbs ($48.2 Million), Charlotte’s Web ($17.7 Million) and Distillery ($15.0 Million).
A number of companies are attempting to capture market share in the CBD-for-pets arena. A recent review by Small Cap Power highlighted four up-and-coming firms in the pet-CBD space, ranked by market capitalization:
- Curaleaf Holdings. Last year, this $6.6 billion company made its entrance into the pet market with the launch of Bido, a line of hemp-based CBD products for pets. Their product line includes therapeutic oils and treats in a variety of flavors.
- Charlotte’s Web Holdings. As listed above, this is one of the largest American manufacturers of CBD. It is headquartered in Boulder, Co. The company offers hemp extract oil and infused balm for pets. It is preparing to release hemp-extract chews, specifically made for dogs.
- CannTrust Holdings. Currently expanding to a 430,000 sq.ft. hydroponic facility in Ontario, this $1.1 billion company recently signed a letter of intent with Grey Wolf Animal Health, a private company that serves veterinarians and pet owners.
- True Leaf Medicine International. This $49.9 Million company, based in Vernon, Canada, has two divisions: True Leaf Medicine Inc. and True Leaf Pet Inc. The firm’s pet line includes chews, dental sticks, and supplement oils.
The North American Market is Ramping Up
The U.S. and Canada account for the largest market share of CBD products. This is due not only to the therapeutic value of CBD for humans and pets but also to increasing trends on overall legalization for all cannabis components in Canada and the U.S.
In fact, the latest Nielsen projections show that within the next year, the U.S. hemp-based CBD market may be a $2.25 billion to $2.75 billion industry according to the trade periodical Pet Business. This is expected to represent approximately 3 to 5 % of the total American CBD market share. The Canadian Veterinary Journal reports that CBD usage for pets in Canada is on an upward trend, especially since the passage of the Cannabis Act by that country in 2018.
The Global CBD Market, Including for Pets, is Also Growing
As reported by Grand View Research, on a global basis, the CBD market is valued at over $4.6 billion. According to many business analysts, the global demand is expected to grow at a robust rate going forward. China is the largest hemp cultivator in Asia and grows nearly half of the world’s hemp production. The market for CBD products in Japan is growing nearly 100% a year, as reported by Hemp Industry Daily. CBD is legal in most European countries; Health Europa reports that CBD for pets is getting increasingly popular in many European countries.
Clearly, a number of indicators, including gross sales, increased research, and anecdotal evidence, are telling us that the pet CBD market is in an early and robust growth phase, not only in the United States but globally as well. Given that pet owners are increasingly likely to consider their pets as cherished members of their family, this upward trend is likely to continue.