The Asian market will be multiplied at least by 10 to reach around 120 million dollars by 2026
Asia is beginning to take an interest in the use of cannabis. Thailand has legalized growing marijuana at home in 2022, while South Korea, Japan and Malaysia are paving the way for pharmaceutical applications. Cannabis market estimated at $100 billion by 2026, research firm says Prohibition Partners, regional companies are gearing up for Asian consumer demand.
Thailand's decision to remove cannabis from narcotics control lists is nominally intended to support its medical use, but it will understandably facilitate recreational use, which could boost the influx of international tourists. Renewable energy company Gunkul Engineering has committed 2 billion baht ($57,6 million) to building a new cannabis plantation and extraction facility, local Thai media reported. Cannabis-leaf chicken leg snacks and cannabidiol-infused green teas made by Bangkok-listed Srinanaporn Marketing and Ichitan Group are already lining the shelves of local supermarkets.
Even Japan, known for its strict cannabis possession laws, allows cannabidiol, an active ingredient in cannabis that does not get users high, commonly known as CBD. E-commerce company Rakuten and Pan Pacific International's Don Quijote supermarkets now offer a wide range of CBD oils and gums. South Korea was the first country in East Asia to legalize pharmaceutical cannabis, and Japan, malaysia and Taiwan are all considering similar measures. If the US experience is any guide, regulated pharmaceutical use will inevitably trickle down to the leisure market, boosting overall demand.
China is a question mark. The country has been marked by its experience of opium, which it associates with imperialism. On the other hand, the marijuana plant grows naturally in Yunnan province. China is also responsible for around 70% of the world's production of hemp fibers. Extraction of full-spectrum hemp oil, which contains CBD, is legal for export under strict controls, notes Andy Li, founder of Yunnan-based Hempson. Given Beijing's conservative attitudes, the recreational and medical use of cannabis in China is likely to take place in neighboring countries.
Weed lovers should be optimistic, however. Conor O'Brien, a former principal analyst at Prohibition Partners, believes the Asian market will grow at least 10-fold to around $120 million by 2026. That's just a fraction of the $100 billion that is weed industry, but it's a start. Cannabis in Asia will burn slowly, but where there is smoke there may be fire.