Number of pages: 100 | Report Format: PDF | Published date: June 26, 2023
Historical Years – 2021 | Base Year – 2022 | Forecasted Years – 2023-2031
According to the deep-dive market assessment study by Growth Plus Reports, the global cannabis testing services market was valued at US$ 1.65 billion in 2022 and is expected to register a revenue CAGR of 13.2% to reach US$ 5.03 billion by 2031.
Cannabis Testing Services Market Fundamentals
Cannabis testing is the process of analyzing and evaluating cannabis and cannabis-derived products to assess their quality, safety, and compliance with regulatory standards. The testing is typically performed by specialized laboratories equipped with the necessary equipment and expertise to conduct a variety of tests on cannabis samples.Cannabis testing determines the levels of cannabinoids, such as THC (tetrahydrocannabinol) and CBD (cannabidiol), in the product. Potency testing helps establish the concentration of these compounds, which is essential for accurate labeling, dosing, and understanding the effects of the product. Cannabis testing identifies the presence of various contaminants, including pesticides, heavy metals, residual solvents, mycotoxins, and microbial contaminants. These tests ensure that cannabis products are safe for consumption and compliant with regulatory limits. Accreditation and quality assurance programs specific to cannabis testing are gaining prominence. Laboratories are seeking ISO/IEC 17025 accreditation, which demonstrates their technical competence and adherence to international standards.
Cannabis Testing Services Market Dynamics
The global cannabis testing services market is driven by several factors that contribute to its growth. The increasing legalization of cannabis for medical and recreational use in various regions and countries drives the demand for cannabis testing services. In the United States, the use of cannabis for medical purposes is legal in 38 states, four out of five permanently inhabited U.S. territories, and the District of Columbia, as of March 2023. Testing services ensure that cannabis products meet the standards set by regulatory bodies, fostering consumer confidence and industry compliance. Additionally, it puts no restrictions on the sale, transport, or possession of hemp-derived products, so long as those items are produced in a manner consistent with the law. In February 2021, lawmakers in the United States stated that they were planning new legislation that would end the federal prohibition on marijuana, which has been legalized to some degree by many states. These initiatives are likely to impact the demand for cannabis testing equipment in a positive manner. As cannabis-based products find increased legislation and come under the ambit of law, the demand for testing equipment is expected to increase during the study period. Additionally, a variety of neurological and psychiatric diseases are treated with cannabis extracts. During the projected period, the global cannabis testing services market is anticipated to expand as the prevalence of these conditions rises along with cannabis use and manufacturing. The European Brain Council estimates that as of 2022, there were 600 neurological illnesses documented worldwide, making mental disorders one of the main causes of sickness and impairment in the globe. The most prevalent mental condition is depression. Worldwide, depression affects more than 264 million individuals of all ages. Depression affects more women than males. Other reasons driving the market include rising awareness of and using software services in labs testing cannabis. The recent cannabis testing activities by several important market companies are probably going to contribute to the market's expansion. For instance, Method Testing Labs, a 2021-founded independent testing facility for cannabis and hemp, opened a lab in Brandon, Florida, in September 2022. Such actions are anticipated to contribute to market growth.
Cannabis Testing Services Market Ecosystem
The global cannabis testing services market is analyzed from the following perspectives: test type, product, end user, and region.
Cannabis Testing Services Market by Test Type
Based on the test type, the global cannabis testing services market is segmented into heavy metal testing, pesticide screening, microscopy testing, potency testing, terpene profiling, residual solvent screening, and others.
The potency testing services account for the highest revenue share of 23% in the global cannabis testing services market. The market is primarily being driven by an increase in the demand for analyzing the potency of various cannabinoids, particularly CBD (Cannabidiol) and Tetrahydrocannabinol (THC) in grown cannabis, as well as an increase in the use of efficient potencies testing techniques like Gas Chromatography (GC) and High-Performance Liquid Chromatography (HPLC) for testing samples. Additionally, it is projected that during the forecast period, this segment will expand the fastest. The main reasons anticipated to propel the global cannabis testing services market are the rising quality checks for cannabinoids to enable appropriate labeling of products in the medical and recreational sectors and their increasing exports to nations where the industry is heavily regulated. The rise of this segment in the cannabis testing services market over the projection period is further supported by the potency testing service's ability to keep customers well-informed about the product's quality.
Cannabis Testing Services Market by Product
Based on the technology, the global cannabis testing services market is segmented into instruments, and consumables & test kits.
Instruments segment accounts for the highest revenue share in the global cannabis testing services market. There is a lot of use of tools like HPLC, gas chromatography, and liquid chromatography. Techniques for chromatography are frequently used to reduce contamination. They can effectively clean cannabis and hemp extracts of pollutants like fungicides, pesticides, herbicides, synergists, and heavy metals at a reasonable price. Additionally, tetrahydrocannabinol (THC) levels in cannabis extracts can be decreased using chromatography. They are employed to extract from cannabis extracts cannabinoids like cannabidiol (CBD), THC, cannabinol (CBN), cannabigerol (CBG), etc. A lot of businesses, like Sorbent Technologies Inc., provide specialized testing and extraction solutions based on chromatography. In March 2021, PerkinElmer launched the industry-first Certified reference material (CRM) reagent and consumable kit to streamline cannabis pesticide testing workflows. Such products make it simpler to analyze cannabis products using analytical tools, which is expected to contribute to segmental expansion throughout the course of the projected year.
Cannabis Testing Services Market by End User
Based on the end user, the global cannabis testing services market is segmented into cannabis drug manufacturers, cannabis cultivators, research institutes, and others.
Cannabis cultivators account for a significant revenue share of 63% in the global market. Due to official regulations on the amount of THC that can be found in cannabis products in many nations, growers are establishing contracts with testing labs and research institutions. Additionally, these producers must offer several plant varieties at various costs to manufacturers and wholesalers according to their CBD and THC concentrations. These are the main elements promoting the segment's expansion.
The cannabis drug manufacturers segment is projected to be the fastest growing during the forecast period. The main drivers of the segment's growth are the expanding acceptability of marijuana as a treatment and the increase in cannabis-based clinical trials by major pharma companies like Sanofi, Solvay Pharmaceuticals, and Pfizer.
Cannabis Testing Services Market by Region
Geographically, the global cannabis testing services market has been segmented into North America, Europe, Asia Pacific, Latin America, and the Middle East & Africa.
North America accounts for a significant revenue share in the global cannabis testing services market. The high prevalence of chronic diseases in the area, favorable laws, and the existence of big businesses are all contributing factors to market growth. Over 90,000 Canadians over 40 years of age currently have Parkinson's disease, according to a Government of Canada report published in April 2022. According to data on Parkinson's disease updated by the National Institute of Neurological Disorders and Stroke in July 2022, about 500,000 Americans were reported to have received a diagnosis. However, some experts believe that over 1 million Americans actually have Parkinson's disease but are going unreported because of issues with misdiagnosis or delayed diagnosis. Products with CBD extracted from cannabis are used to treat some Parkinson's and other neurological illnesses symptoms. Such high incidence rates are anticipated to boost market expansion. Additionally, partnerships between significant businesses and a rise in research activities are some of the variables anticipated to fuel the growth of the global cannabis testing services market. Due to its generous healthcare policies and substantial patient population, the United States is anticipated to have the largest share in this region.
Cannabis Testing Services Market Competitive Landscape
The prominent players operating in the global cannabis testing services market are: -
Cannabis Testing Services Market Strategic Developments
Cannabis testing is the process of analyzing and evaluating cannabis and cannabis-derived products to assess their quality, safety, and compliance with regulatory standards.
The revenue CAGR for the cannabis testing services market is 13.2% during the forecast period.
Agilent Technologies Inc., Merck KGaA, Shimadzu Scientific Instruments, PerkinElmer Inc., and Steep Hill, Inc are a few of the major players in the global cannabis testing services market.
Asia Pacific is the region with the highest growth rate in the global cannabis testing services market.
The high cost involved in cannabis testing services is a major drawback of the global market growth.
*Insights on financial performance are subject to the availability of information in the public domain