Industrial Cannabis Market Size, Growth, and Trends 2025 to 2034

Industrial Cannabis Market Size, Share and Forecast Report

The global industrial cannabis market size reached at USD 65.95 billion in 2024 and is anticipated to increase from USD 73.55 billion in 2025 to an estimated USD 196.40 billion by 2034, witnessing a CAGR of 11.53% during the forecast period from 2025 to 2034. The market is expanding at a fast pace due to a variety of applications and growing demand for eco-friendly products.

Key Highlights

• By region, Europe dominated the global market with the largest share of 36% in 2024.
• By region, North America is expected to grow at a notable CAGR from 2025 to 2034.
• By product type, hemp fiber segment held the major market share of 36% in 2024.
• By product type, cannabinoids segment is projected to grow at a CAGR in between 2025 and 2034.
• By cultivation type, conventional farming segment contributed the biggest market share of 58% in 2024.
• By cultivation type, controlled environment agriculture segment is expanding at a significant CAGR in between 2025 and 2034.
• By end user industry, textile & apparel segment dominated the market by holding the share of 33% in 2024. 
• By end user industry, pharma & wellness segment is expected to grow at a significant CAGR over the projected period. 
• By distribution channel, B2B supply contracts segment held the major market share of 62% in 2024.
• By distribution channel, retail & e-commerce segment is expected to grow at a CAGR in between 2025 and 2034.

Industry Coverage

What is Industrial Cannabis Market?

The Global Industrial Cannabis Market refers to the large-scale cultivation, processing, and utilization of Cannabis sativa L. varieties with low tetrahydrocannabinol (THC) content (≤0.3%) for industrial, nutritional, pharmaceutical, and material applications. Industrial cannabis, often termed hemp, delivers fiber, seeds, cannabinoids (CBD, CBG), and bio-based feedstocks for use in textiles, food, construction, personal care, and bioplastics. The market is driven by regulatory liberalization, sustainable material demand, and the expanding CBD-based health and wellness sector. Advanced genetics, precision farming, and CO₂ extraction are enhancing yield, quality, and profitability across the value chain.

Industrial Cannabis Market Outlook

• Industry Growth Overview: The industrial cannabis market is expanding greatly, fueled by demand in the food and beverage industry (hemp seeds, oils), personal care (CBD-infused skincare), and textiles (sustainable fabrics). Additional important sectors comprise medical and recreational cannabis, which have experienced significant growth from rising legalization and a surge in demand for therapeutic and wellness items. The growing consumer interest in plant-based, holistic, and organic health options is increasing the market for wellness products derived from cannabis. 
• Sustainability Trends: The industrial cannabis sector is increasingly influenced by a heightened focus on sustainability, evolving from a good practice to an essential regulatory and consumer-driven necessity. Major trends encompass the embrace of sustainable farming practices, an emphasis on the plant's natural environmental advantages, and a rising demand for transparent, organic, and circular supply chains.
• Startup Ecosystem: The industrial cannabis startup ecosystem is a dynamic, rapidly-expanding field concentrated on various uses such as health and wellness products, eco-friendly textiles, building materials, and business-to-business technology offerings. The market is quickly changing, fueled by continuous legalization initiatives and technological progress. For instance, BOHECO (Bombay Hemp Company) in India concentrates on medicinal studies, fabrics, and health items, supported by prominent investors. Vertosa (US), a tech company specializing in the development of stable nano- and micro-emulsions for infused drinks and food products. 

Technological Shift in the Industrial Cannabis Market 

Technological innovations are transforming the industrial cannabis industry via precision farming, genetic modification, sophisticated extraction methods, and data analytics systems, resulting in enhanced efficiency, reliability, and product quality. Techniques like supercritical CO2 extraction, ultrasonic-assisted extraction, and molecular distillation are employed to create pure and powerful concentrates. Innovative biotechnology techniques utilize modified microorganisms such as yeast strains to generate cannabinoids in a laboratory environment. AI is utilized in predictive analytics to anticipate demand, enhance supply chains, identify pests and diseases promptly, and even customize cannabinoid profiles in novel strains. 

Trade Analysis of Industrial Cannabis Market: Export and Import Statistics 

• Worldwide, the leading three exporters of Cannabis and HSN Code 3004 are India, South Africa, and Botswana. India tops the global market in Cannabis and HSN Code 3004 exports with 59 shipments, while South Africa follows with 26 shipments, and Botswana ranks third with 21 shipments. Most of the Cannabis and HSN Code 3004 exports from India are directed towards Bangladesh, Sri Lanka, and Botswana.
• Most of the Cannabis in the United States is sourced from China. Worldwide, the leading three Cannabis importers are Germany, the United States, and France. Germany tops global Cannabis imports with 119 shipments, the United States follows with 99 shipments, and France ranks third with 82 shipments.
• In the second quarter of 2025, Germany brought in 43.257 tonnes of medical cannabis products. This marks an uptick from the former record established in Q1 2025 of 37.519 tonnes and a notable rise in contrast to Q2 2024, when Germany brought in 11.634 tonnes of medical cannabis products. 

Value Chain Analysis of Industrial Cannabis Market

Raw Material Procurement 

• The primary raw material for industrial cannabis procurement is the biomass of the Cannabis sativa L. plant, which includes the stalks, seeds, leaves, and flowers. The specific part procured depends entirely on the intended final product. 

Processing of Industrial Cannabis 

• Industrial cannabis processing involves distinct pathways depending on the desired product. The initial steps include harvesting and drying the plants, followed by mechanical or wet retting to separate the bast fibers from the woody core. Further processing extracts oil from seeds, uses fibers for composites.

Logistic and Distribution

• The distribution and logistics of industrial cannabis involve a complex, multi-stage supply chain that is heavily influenced by strict, often fragmented regulations, the need for traceability. 

Industrial Cannabis Market Regional Insights 

Industrial Cannabis Market of Europe Soars on Legalization and Eco-Friendly Demand

Europe dominated the industrial cannabis market in 2024. The European industrial cannabis sector is expanding, fueled by a rise in legalization, particularly for medical purposes, along with evolving public attitudes and regulatory changes. The market is mainly fueled by increasing demand for eco-friendly materials, plant-based food items, and cannabidiol (CBD) products sourced from industrial hemp, a non-psychoactive type of the cannabis plant. Over €500 million has been poured into the cannabis sector so far, and six nations have revealed new laws concerning the cultivation, distribution, or use of cannabis.

Germany Industrial Cannabis Market Analysis

Germany is presently Europe’s biggest industrial cannabis market, having initiated medical cannabis sales via pharmacies in 2017 and legalized recreational cannabis in 2024. The nation’s industrial sector and regulatory system vary from the models observed in the United States due to several factors, primarily Germany’s membership in the European Union. Germany’s industry is tied to existing EU agreements due to EU membership, which adds complexity to a cannabis company’s expansion strategy formulation. Canada continues to serve as the top source of medical cannabis imports to Germany, with BfArM reporting that Germany has imported 36.164 tonnes of medical cannabis products in the first half of 2025.

The Evolving North American Industrial Cannabis Market: Regulation and Product Expansion

North America expects the significant growth during the forecast period. The changing regulatory framework in North America significantly influences the North America industrial cannabis market industry. With an increasing number of states and provinces permitting cannabis for medicinal and recreational purposes, the market sees significant expansion. Market diversification in the North America industrial cannabis market Industry is increasingly evident as companies broaden their product offerings to serve different consumer segments. This encompasses the launch of edibles, drinks, and wellness items, catering to a wider audience outside of conventional cannabis consumers. 

United States Industrial Cannabis Market Analysis 

In the United States, cannabis is utilized in the pharmaceutical, cosmetic, and food and beverage sectors. Increasing acceptance for medical applications and the escalating legalization of cannabis are the main factors propelling market expansion. Cannabis is useful for alleviating chronic pain and nausea resulting from chemotherapy. For example, the Food and Drug Administration has sanctioned the use of cannabis-based medications, including Epidiolex, Cesamet, and others, for managing seizures and side effects from chemotherapy.

Asia Pacific's Industrial Cannabis: A Market Driven by Eco-Friendly and Medical Innovations

Industrial cannabis market of Asia Pacific is growing at notable rate. This expansion is fueled by rising demand for hemp-derived products in industries such as textiles, food, and beverages, along with heightened awareness of the ecological advantages of hemp farming. China is anticipated to experience the fastest growth rate in the hemp farming market. The use of cannabis-based products is being propelled by pharmaceutical applications, such as pain relief, mental health therapies, and treatments for chronic illnesses. 

China Industrial Cannabis Market Analysis

China is the leading region for cannabis cultivation globally, making up nearly 50% of the total area worldwide. China's industrial hemp market features a varied geographical landscape, with major areas like Beijing, Shanghai, Guangzhou, and Shenzhen leading the growth. China possesses a considerable number of international patents concerning cannabis and hemp, signifying a robust emphasis on research and development in this area.

Expanding Industrial Cannabis Market of Latin America

The industrial cannabis market in Latin America is expanding, fueled by growing legalization, supportive government measures, and a rising demand for eco-friendly products in multiple sectors. The main force continues to be the enormous need from the textile sector for eco-friendly fibers, yet investigations are broadening into food, medical, and health-related goods. Latin America enjoys an optimal climate and affordable labor and construction expenses, resulting in production costs that are considerably lower compared to North America. This positions the area as a possible global export center. 

Brazil Industrial Cannabis Market Analysis

The industrial cannabis sector in Brazil is developing and set for substantial expansion, propelled by recent landmark judicial decisions that differentiate it from psychoactive marijuana and require regulation for its production and application. The market is still developing but offers significant prospects across multiple applications, especially in construction, with potential growth into food, cosmetics, and textiles in the future.

The Rise of Industrial Cannabis in the Middle East & Africa

The industrial cannabis market in the Middle East and Africa (MEA) is a developing sector with considerable growth opportunities, primarily fueled by rising demand for sustainable products and slow regulatory changes. The various uses of industrial hemp (fiber, seeds, shives) render it a desirable crop for economic diversification. The cost-effectiveness, reliability, and user-friendliness of contemporary cannabis products make them appealing for medicinal and recreational purposes, leading to increased acceptance and utilization. 

UAE Industrial Cannabis Market Analysis

The market in the UAE is quickly growing, driven by the need for hemp-derived goods such as food, fabrics, and building materials, and backed by changing regulations. Primary factors encompass growing consumer recognition of hemp's advantages, notable expansion in the medical cannabis industry, and a transition towards sustainable and environmentally friendly options. Funds are also being directed into processing infrastructure to bolster this expansion across various sectors, such as pharmaceuticals and personal care.

Segmental Insights 

Product Type Insights 

Why did the Hemp Fiber Segment Dominate the Industrial Cannabis Market?

Hemp fiber segment led the industrial cannabis market in 2024. This expansion can be linked to the rising use of hemp fiber in sectors like textiles, automotive, construction, and personal care. Hemp fiber is prized for its eco-friendliness, strength, and ability to break down naturally, presenting a compelling substitute for synthetic materials. Improvements in fiber processing and material mixing technology have elevated the functionality and adaptability of products made from hemp.

Cannabinoids Segment is Observed to Grow at the Fastest Rate During the Forecast Period. 

The cannabinoids sector is growing swiftly, fueled by the remarkable health advantages of the products, encompassing therapeutic effects and their application in veterinary treatments. Due to the various applications of cannabinoids, the need for personal care items like body lotions, oils, and capsules has surged. The increasing popularity of vaping products among youth has also added to the market revenue. 

The hemp seed segment is growing rapidly throughout the forecast period. Hemp seed is considered the most nutritious seed globally because of its various health benefits and its application as a pain reliever in medicine. The worldwide hemp seed market is projected to grow due to rising demand for hemp seeds compared to conventional herbal seeds, owing to their versatility and role in enhancing overall health.

Cultivation Type Insights 

How did the Conventional Farming Segment Dominate the Industrial Cannabis Market?

Conventional farming segment held the dominating share of the industrial cannabis market in 2024. Conventional farming results in reduced production costs per unit because of economies of scale. Its cost-effectiveness reduced operational expenses, and scalability of its proven cultivation techniques compared to organic or controlled environment options are key factors in its prevalence.

Controlled Environment Agriculture Segment is Seen to Grow at a Notable Rate During the Predicted Timeframe. 

This growth is attributed to its ability to precisely manage environmental conditions, guaranteeing uniform product quality, continuous cultivation, and increased yields, all of which are essential for producing pharmaceutical and medicinal cannabis. CEA provides benefits such as lowered pest and disease threats, enhanced resource efficiency. 

The organic farming segment is expanding rapidly due to rising consumer interest in natural and chemical-free goods, greater health and environmental consciousness, and the capacity of organic methods to yield a high-quality premium product.

End Use Industry Insights 

Which End Use Industry Dominated the Industrial Cannabis Market in 2024?

Textile & apparel segment dominated the market with the largest share in 2024. Hemp textiles are durable, hypoallergenic, and inherently resistant to UV rays, mold, and mildew, providing an extra benefit compared to other materials. Furthermore, it can be combined with cotton or linen, enhancing the elasticity and durability of the material. Rising environmental consciousness has boosted the demand for sustainable and eco-friendly products.

Pharma & Wellness Segment is Expected to Grow at the Fastest Rate in the Market During the Forecast Period. 

This growth is driven by the rising legalization of medical cannabis, an increasing amount of clinical evidence backing its therapeutic advantages, and the capacity of pharmaceutical companies to deliver standardized, quality-controlled products. Medical cannabis has demonstrated considerable efficacy in addressing numerous conditions like chronic pain, epilepsy, symptoms of multiple sclerosis, and anxiety

Food & beverage manufacturers segment expanding at notable rate during the forecast period. due to consumer shifts away from smoking, increasing demand for wellness-oriented products, and product innovation in edibles and drinks. Key factors include the convenience, discretion, and controlled dosages offered by edibles, the growing popularity of cannabis-infused drinks as healthier alternatives. 

Distribution Channel Insights 

Which Distribution Channel Dominated the Industrial Cannabis Market?

B2B supply contracts segment held the largest share of the market in 2024, as it acts as the crucial supply route for raw materials and bulk products to various industries for additional processing and manufacturing. B2B agreements define explicit terms for quality assurance, testing, and adherence to regulations, which is essential for companies functioning in a stringent legal environment.

Retail & E-commerce Segment is Observed to Grow at the Fastest Rate During the Forecast Period.

Driven by rising legalization and regulatory easing, a notable consumer demand for easy access and wellness goods, and the incorporation of emerging technologies. E-commerce sites effectively display this variety, featuring comprehensive descriptions, laboratory results, and customer feedback that contribute to consumer confidence.

Recent Developments in the Industrial Cannabis Market

New Jersey Economic Development Authority

• Grant: In November 2025, the New Jersey Economic Development Authority launched $5 million program to assist recreational cannabis entrepreneurs in overseeing the expenses associated with compliance and operations while they establish their businesses. The Cannabis Business Development (CBD) grant will provide eligible cannabis manufacturers, cultivators, retailers, and testing laboratories in New Jersey with one-time reimbursements of $75,000. (Source: NJBIZ)

MariMed Inc.

• Market Expansion: In November 2025, MariMed Inc., a prominent cannabis consumer packaged goods firm and retailer, announced manufacturing and distribution agreements that permit the Company to introduce their market-leading beverage and edibles brands, such as Vibations™ and Betty’s Eddies™, into the swiftly expanding hemp-derived THC market. (Source: Globe Newswire)

Top Key Players in the Industrial Cannabis Market

HempFlax Group B.V.

Corporate Information

• Name: HempFlax Group B.V. (often abbreviated “HempFlax”). 
• Headquarters: Hendrik Westerstraat 20 22, 9665 AL Oude Pekela, The Netherlands. 
• Legal registration: KvK (Dutch Chamber of Commerce) number 10145305. 
• Business scope: Industrial hemp cultivation, processing (“seed to shelf”), fibre & hemp based products for multiple applications (construction, animal bedding, nutraceuticals, bioplastics, etc.).

History and Background

• Founded: The company was founded in 1993 by Ben Dronkers with the aim of reviving industrial hemp cultivation in the Netherlands. 
• First crop: In 1994, HempFlax planted about 140 ha of hemp in the Netherlands. 
• Growth: Over time, expanded cultivation across Netherlands, Germany, Romania. By 2018, ~2,600 ha under hemp cultivation. 

Key Developments and Strategic Initiatives

• Vertical integration (“whole plant model”): HempFlax processes the whole hemp plant (stems, fibres, seeds, leaves) enabling multiple value streams. 
• Geographic expansion: Moved beyond Netherlands into Romania and Germany to secure large-scale cultivation and processing. 

Mergers & Acquisitions

• Acquisition of German company Thermo Natur GmbH & Co. KG (manufacturer of natural fibre insulation) included assets, licences, brand & certifications. 
• Acquisition of processors: For example takeover of competitor firms Hempron and Vernaro (German/Netherlands) to expand fibre processing capacity. 

Partnerships & Collaborations

• Equipment/manufacturing partnerships: Collaborated with John Deere (US farm implement manufacturer) to develop a “Double Cut Combine” harvester for hemp. 
• Automotive industry supplies: HempFlax supplies natural fibre components to premium automakers (e.g., Bugatti, Porsche) for car parts. 
• Certification & sustainability partners: Works with certification body DEKRA and ISCC for sustainable fibre supply chains.

Product Launches/Innovations

• Launch of “building supplies” division producing insulation materials using hemp fibre. 
• Introduction of pelletised hemp fibre for injection moulding / compounding (2016 onwards) to serve plastics/automotive sectors. 
• Development of harvesting and decortication technologies (e.g., dedicated combine harvester, decortication line adding 40,000 t annual capacity). 

Key Technology Focus Areas

• Harvester and field machinery technology: e.g., Double Cut Combine for separating seeds and stalks. 
• Decortication & fibre processing: Converting hemp stalks into long fibres, hurds, pellets, suitable for insulation, automotive, bioplastics. 

R&D Organisation & Investment

• HempFlax appears to have internal development of machinery and processing lines (harvesters, decortication). 
• Invested significantly in upgrading processing facilities (e.g., €3 m investment in Dutch HQ). 
• Cultivation scale expansion and genetics work (e.g., in Romania) supports R&D in crop varieties and processing throughput. 

SWOT Analysis

Strengths

• Vertically integrated model (cultivation through processing to finished products) enabling control over supply chain and cost.
• Diverse product portfolio (fibres, nutraceuticals, building insulation, animal bedding, automotive components) reduces dependence on any one market.
• Strong sustainability credentials (ISCC PLUS, solar/hydrogen energy initiatives) adding competitive advantage in eco market.
• Established scale: multi country operations (NL, Germany, Romania), large cultivation areas.
  Technology leadership in hemp harvesting and processing.

Weaknesses

• Capital intensive: high investment required for machinery, processing, energy upgrades may strain finances if markets slow.
• Regulatory complexity: Industrial hemp markets vary by country; issues around THC thresholds, subsidies, and cultivation licences may pose risk.
• Market diversification risk: While diversified, some markets (e.g., construction insulation, automotive biocomposites) are still niche and competitive with established materials (wood, synthetic fibres).
• Dependence on European regulations & demand: Much of the business is Europe centric, so exposure to EU regulatory/policy risk.

Opportunities

• Rising global demand for sustainable materials (bio plastics, natural fibres, green building materials) plays to HempFlax strengths.
• Hemp supply chain for nutraceuticals (CBD, hemp seed oil, capsules) expanding, potential for growth in wellness sector.
• Expansion into new geographies (beyond Europe) or new applications (textiles, composites, packaging) could unlock further growth.
• Carbon footprint/circular economy focus: Positioning hemp as carbon sequestering material gives environmental differentiation.

Threats

• Competition from other natural fibre producers or synthetic fibre technologies that may undercut cost or performance.
• Supply chain risks: Weather/climate impact on hemp cultivation; shifts in crop subsidies; logistical challenges in processing large volumes.
• Regulatory constraints: Hemp classification, THC limits, cross border trade can impose hurdles.
• Market adoption risk: Some end use markets (e.g., hemp insulation) still represent small share and need broader adoption; slow uptake could hamper growth.

Recent News & Strategic Updates

• In 2021 HempFlax announced a €3 million investment in its Dutch headquarters in Oude Pekela, aiming to double fibre processing capacity and install solar panels / hydrogen vehicles. 
• In 2021 (Nov) the company stated it expects to become “energy positive” at its Dutch factory, doubling capacity and improving sustainability. 

Other Key Players in the Market 

• Canopy Growth Corporation: Canopy Growth Corporation is a leading Canadian cannabis firm dedicated to the manufacturing and distribution of a wide variety of cannabis and hemp-derived products for medical and recreational purposes. Canopy Growth provides a diverse range of items such as dried flower, pre-rolled joints, vapes, edibles (gummies), drinks, oils, softgel capsules, and concentrates. 
• Aurora Cannabis Inc.: Aurora Cannabis Inc. has adeptly established itself as a frontrunner in the worldwide medical cannabis industry. The company has intentionally downplayed the competitive, lower-margin Canadian recreational market to focus on international medical sectors. 
• Cronos Group Inc.: Cronos Group Inc. is a forward-thinking international cannabinoid firm dedicated to enhancing research, technology, and product innovation in the cannabis industry. It functions in both the medical and recreational (adult-use) markets, mainly in Canada and Israel, and additionally supplies products to markets such as Germany and the UK. 
• Ecofibre Limited 
• Charlotte’s Web Holdings, Inc.
• Konoplex Group 
• Hemp Inc.
• Elixinol Wellness Limited 
• EIHA Projects GmbH 
• HemPoland Sp. z o.o. (Green Roads) 
• HempMeds (Medical Marijuana, Inc.) 
• Blue Sky Hemp Ventures 
• Colorado Hemp Works, Inc. 
• TerrAscend Corp.

Segments Covered in the Report

By Product Type

• Hemp Fiber 
  • Textile-grade fiber for yarns and fabrics 
  • Industrial fiber for composites and insulation 
• Hemp Seeds 
  • Whole seeds and dehulled kernels 
  • Cold-pressed hempseed oil and protein powder 
• Cannabinoids (CBD, CBG, etc.) 
  • Full-spectrum CBD extracts 
  • Isolated cannabinoids for nutraceutical use 
• Hemp Hurds / Shives 
  • Hempcrete and animal bedding applications 

By Cultivation Type 

• Conventional Farming 
  • Field-based production for fiber and seed 
  • Mechanized harvesting and bulk drying 
• Organic Farming 
  • Chemical-free cultivation for food and nutraceutical markets 
  • Certified eco-label production systems 
• Controlled Environment Agriculture (CEA) 
  • Indoor and greenhouse CBD-focused cultivation 
  • Hydroponic and precision fertigation systems 

By End-use Industry 

• Textile & Apparel 
  • Clothing, footwear, and accessories 
  • Eco-fabrics and industrial textiles 
• Construction & Materials 
  • Hempcrete blocks and insulation panels 
  • Reinforced composites and bioplastics 
• Food & Beverage Manufacturers 
  • Plant-based protein producers and beverage formulators 
• Pharma & Wellness Companies 
  • CBD ingredient processors and supplement brands 

By Distribution Channel 

• B2B Supply Contracts 
  • Industrial buyers and ingredient manufacturers 
  • OEM textile, food, and pharma supply chains 
• Retail & E-commerce 
  • CBD wellness products and hemp-based foods 
  • Direct-to-consumer online platforms 

By Region

• North America
• Europe
• Asia Pacific
• MEA
• Latin America