CANNABIS PACKAGING MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2023 - 2030)

Global cannabis packaging market  is expected to reach US$ 13.17 billion by 2030, from US$ 2.64 billion in 2023, at a CAGR of 25.8% during the forecast period.

Cannabis packaging refers to the packaging solutions used for cannabis products such as marijuana, hemp, and other related items. The packaging protects the product from external damage and extends shelf life. It also helps to comply with regulations regarding child-resistant and tamper evident packaging. The market growth is driven by the legalization of medical and recreational cannabis across various countries.

Global cannabis packaging market is segmented into by material type, packaging type, application, and region. By material, the market is segmented into plastics, paper, glass, metal, cardboard, and others (foils, hemp plastic). The plastics segment held the largest share of the market in 2022. Plastics offer durability, flexibility, and high barrier protection. Increasing use of plastics for packaging of cannabis products is driving the segment growth.

COVID-19 Impact On Global Cannabis Packaging Market

• Increased Demand: With the classification of cannabis dispensaries as essential services in many regions during lockdowns, there was increase in cannabis sales. This led to increased demand for cannabis packaging.
• Health and Safety Concerns: The pandemic heightened focus on health and safety. This had influenced consumer preferences for cannabis packaging, with increased demand for tamper-evident and child-resistant packaging.

Global Cannabis Packaging Market- Regional Insights

• North America is expected to be the largest market for cannabis packaging during the forecast period, and accounted for over 35% of the market share in 2022. The growth of the market in North America is attributed to legalization of cannabis in countries like U.S. and Canada.
• Europe is expected to be the second-largest market for cannabis packaging, and accounted for over 25% of the market share in 2022. The growth of the market in is attributed to increasing demand for cannabis for medical purposes in countries like Germany, Italy, and Croatia.

• Asia Pacific is expected to be the fastest-growing market for cannabis packaging, with a CAGR of over 30% during the forecast period. The growth of the market in Asia Pacific is attributed to increasing legalization of cannabis in countries like Australia, Thailand, and South Korea.

Figure 1. Global Cannabis Packaging Market Share (%), By Region, 2023

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Global Cannabis Packaging Market- Drivers

• Legalization of Cannabis Products: The legalization of cannabis for both recreational and medical use in various countries is a major factor driving the global cannabis packaging market growth. As of 2022, cannabis had been legalized in many parts of North America, South America and Europe. Countries like Canada, Mexico, Uruguay, parts of the U.S., Portugal, Spain, Italy, Croatia, and others have allowed the use of cannabis to some extent. This has resulted in the emergence of many cannabis brands and products in these regions, creating substantial demand for compliant and innovative cannabis packaging solutions. Brands are looking for packaging that stands out, maintains freshness and highlights product information. For instances, in 2022, according to National Institutes Of Health, The Medical Marijuana and Cannabidiol Research Expansion Act, law to allow cannabis to be more easily researched for medical purposes to prevent health crises.

• Growth of the Medical Cannabis Industry: The medical cannabis industry has grown significantly in recent years. Cannabis is being increasingly used for treating health conditions like chronic pain, anxiety, epilepsy, cancer symptoms and muscle spasms. Pharmaceutical companies are conducting research and launching cannabis-based medications. Medical cannabis products need to be packaged properly in child-resistant and tamper evident packaging to ensure patient safety. Also, medical use requires measured doses and clean labeling that further boosts demand for cannabis packaging. The rapid expansion of the medical cannabis sector globally is expected to drive the market growth during the forecast period.
• Product Innovation in Cannabis Packaging: Cannabis packaging suppliers and manufacturers are innovating with new packaging materials, technologies and designs to serve the specific needs of the cannabis industry. For instance, manufacturers are using odor-resistant materials, correct portioning, moisture regulation, UV light protection and other innovative features to maintain freshness and prolong shelf life. Packaging with features like anti-microbial coatings, strip packaging, smart labeling, track-and-trace technologies, anti-counterfeiting and more provide opportunities for growth. Product innovation also enhance safety and convenience for consumers.
• Growth of Cannabis e-Commerce Platforms: Many countries, where cannabis is legal, have also allowed online sales of cannabis products in recent years. This has led to proliferation of cannabis e-retailers and online dispensaries dedicated to cannabis and CBD products. These require packaging suitable for shipping cannabis products safely without damage. Discreet and secure delivery packaging solutions are gaining traction. E-commerce sales also mean wider reach for cannabis brands, necessitating higher volumes of quality packaging. The expansion of e-commerce is expected to drive the market growth.

Global Cannabis Packaging Market- Opportunities

• Sustainable and Compostable Packaging Materials: Sustainability is a priority in the packaging industry, and cannabis packaging is no exception. Consumers and regulators expect more eco-friendly packaging materials and solutions. This presents major opportunities for innovations in sustainable cannabis packaging such as bioplastics, plant-based or renewable materials, and compostable packaging formats. For instance, hemp plastic made using hemp stems is gaining popularity. Similarly, packaging materials like jute, rice husks, coconut coir and molded fibers are viable eco-friendly options. Cannabis brands are adopting such solutions to effectively target sustainability-conscious consumers.
• Expansion into New Geographical Markets: Many countries are considering legalizing cannabis for medical and/or recreational use. Regions like Latin America, Asia Pacific and Africa represent new potential markets for cannabis products and packaging needs. As legalization spreads to these untapped markets, it will create fresh opportunities for cannabis packaging manufacturers to enter and cater to newly emerging cannabis industries in these geographies. For instance, countries such as Thailand, Malaysia, Australia, Argentina, Peru, and South Africa could be next in line to allow regulated cannabis.
• Cannabis Packaging for New Product Categories: There are emerging new categories of cannabis products in addition to the traditional cannabis flower and oils. This includes edibles like chocolates, gummies, cookies, infused beverages, topicals, vaping solutions, sublingual strips and more. Each product format requires specialized packaging needs - for example, child-resistance for edibles. Packaging that caters to new cannabis-infused products offers room for innovation and growth. Developing compliant, safe, and appealing packaging targeted to different cannabis product types will be an impactful opportunity.
• Strategic Partnerships and Collaborations: As cannabis gains broader acceptance, packaging suppliers from pharma, food and other industries have opportunities to enter the nascent cannabis packaging segment through partnerships or collaborations with established cannabis brands. These partnerships allow non-cannabis companies to capitalize on cannabis growth while cannabis brands benefit from their expertise. Recently, there have been partnerships between packaging companies and cannabis brands for proprietary solutions. Building strategic win-win partnerships can help packaging firms to expand their market share and penetration.

Global Cannabis Packaging Market- Trends

• Increasing Adoption of Automation Technologies: Cannabis packaging companies are increasing their investments in automated equipment for packaging line operations. For instance, in 2023, according to Hefestus Automated Excellence, automated cannabis packaging equipment can streamline production processes, increase efficiency, and ensure a higher level of accuracy and consistency in the product and packaging. This includes automated filling and capping, labeling, sorting, inspecting and more. Automation enables efficiency, speed, versatility, precision, and compliance in cannabis packaging. It also minimizes human errors and contamination risks while allowing scalability and flexibility for changing product formats. For instance, custom-built automated packaging lines allow speedy packaging of pre-rolls. Rising trend of incorporating automation will enable cannabis packagers to meet increasing production demands.
• Innovative and Customized Packaging Designs: With growing competition, cannabis brands want their packaging to stand out on shelves and reflect brand image. This has fueled the trend of innovative, customized packaging styles and designs targeted specifically for cannabis products. Packaging incorporates elements like striking graphics, artistic visuals, brand storytelling, security features, and unboxing experiences through the use of embossing, textures, colors, convenient opening, and other creative techniques. Furthermore, brands collaborate with packaging designers and suppliers early on to develop a unique, on-brand packaging mix.
• Compliance with Strict Regulations and Standards: Abiding by the complex and evolving regulations around cannabis product packaging is a critical ongoing trend. Ongoing research also provides updated directions - for example, guidelines on edibles packaging. Companies are actively working to provide regulatory-compliant, certified packaging solutions while also advocating for practical standards. Ensuring that cannabis packaging adheres to all applicable regulations is an important trend.
• Rising Focus on Convenience and Portion Control: Consumers increasingly seek convenience when purchasing cannabis, whether for ease of use, storage or on-the-go discretion. Packaging that offers convenience, like resealable pouches, small portable packs or single-use portions is gaining popularity. Features like controlled dispensing, dosing, and portioning allow tailored consumption. This also provides usage control for new users

Global Cannabis Packaging Market- Restraints

• High Costs of Packaging Solutions: Vital, specialized cannabis packaging tends to be costlier than traditional product packaging, and this can restrain the market growth. The costs arise from customized designs, innovative features, high-barrier materials, authentication technologies and regulatory compliance. For smaller cannabis companies, the steep costs can be prohibitive. Seeking ways to develop effective compliance-based packaging at optimal costs remains an ongoing packaging industry challenge.
• Complexities in the Cannabis Supply Chain: The cannabis supply chain faces complexities like rapidly changing regulations, limited product shelf life, intricate third-party logistics, lack of banking access and custom compliance requirements across different states. Such issues can lead to difficulties tracking, transporting and delivering cannabis products in a timely, legal manner. This, in turn, creates procurement challenges for packaging and increases lead times. Smoothening out cannabis supply chain complexities will help to optimize processes, and facilitate access to compliant cannabis packaging solutions.
• Limitations Due to Varying Regional Cannabis Regulations: In countries, where cannabis laws vary between states/provinces, interstate cannabis product and packaging distribution becomes difficult. For instance, differences in U.S. state laws regarding allowable THC content, packaging requirements, testing and more makes compliance complicated for national cannabis and packaging companies. Similarly, in Canada, differences between provincial cannabis rules limit packaging harmonization. Such issues restrain the market access and growth. However, efforts to align regulations can help to resolve these conflicts and enable smoother packaging compliance across different cannabis markets.

Analyst View:

• Global cannabis packaging market is expected to witness growth over the next decade as legalization efforts continue across North America and Europe. Key drivers of market expansion include an increasing number of states legalizing medical and recreational marijuana use in the U.S. and Canada, further opening its market to Cannabis-infused products. Stricter health and safety regulations being introduced on packaging will also fuel market opportunities for vendors to innovate compliant solutions.
•  High start-up costs involved in specialized printing and manufacturing for cannabis packaging poses barriers for new entrants.
• The North America region, particularly the U.S., currently dominates and will likely continue doing so as their legal cannabis markets mature further. However, countries in Europe are embracing medical cannabis at a rapid pace, and could emerge as the fastest growing regional market in the near future. Germany, Italy, France are leading this consumer revolution in Europe as more nations introduce reforms. Smaller format and single-use Child-resistant packaging will see increased adoption over larger containers due to regulatory emphasis on safety. Meanwhile, sophisticated tamper-evident features, non-toxic materials and digital verification capabilities will become key differentiators for brands as competition heats up within this space.

Global Cannabis Packaging Market- Recent Developments

New Product Launches:

• In February 2021, Spee-Dee, a company offers delivery service, launched a new automated cannabis packaging system
• In October 2020, Pollen Gear is a company provides packaging services, introduced new child-resistant packaging with innovative Slider Lid design for cannabis products. It enhances safety and convenience.

• In December 2020, Dymapak is a packaging companylaunched Vessel, a premium reusable aluminum packaging for cannabis flower. It ensures freshness and is 100% recyclable.

Acquisition and partnerships:

• In April 2023, A&A Global Imports MarijuanaPackaging is a packaging company announced a strategic packaging partnership with Greenlane Holdings Inc. ("Greenlane") to expand their product line
• In September 2023, Square is a financial service platform, entered cannabis market in partnership with Jane Technologies, an online ordering platform service for cannabis dispensaries

Figure 2. Global Cannabis Packaging Market Share (%), By Application, 2023

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Top companies in Global Cannabis Packaging Market:

• Kush Supply Co.
• L.Clark
• KAYA Packaging
• Impak Corporation
• Pollen Gear
• Maple Leaf Green World
• Lexaria Bioscience
• Cannaline Cannabis Packaging Solutions
• Green Rush Packaging
• Berry Global
• Pacific Packaging
• Sun Grown Packaging
• Sana Packaging
• SKS Bottle & Packaging
• SWAGPLUG
• HLP Klearfold
• N2 Packaging Systems
• Dymapak
• Funksac

*Definition: The cannabis packaging efers to the packaging products and solutions utilized for cannabis-based products like marijuana, hemp, CBD, THC, and other cannabis derivatives. Cannabis packaging is necessary for the transportation, handling, and sale of cannabis products. It protects the product from damage, contamination, and tampering while also maintaining compliance with regulations. The market has witnessed substantial growth in recent years, owing to cannabis legalization and the rise of cannabis consumer brands and products. With innovative packaging formats, technologies, and materials emerging, the market is expected to expand significantly in the coming years.