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Cannabis-infused drinks nail the new in beverage sector
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Tuesday, 16 October, 2018, 08 : 00 AM [IST]
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Venkatesh Ganapathy
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What is cannabis?
Cannabis is the most widely-used illegal drug in Britain. It comes from the cannabis plant and contains tetrahydrocannabinol (THC), which affects the mind and mood. The THC can give users a "chilled out" feeling but it can also cause hallucinations and make people feel paranoid and panicked.
It is normally smoked but can also be eaten and comes in three main forms: Hash - a lump of resin; Marijuana - the dried leaves and flowering parts of the female plant; Oil - a thick honey-like substance.
What is medicinal cannabis?
Cannabis also contains cannabidiol (CBD) which scientists are investigating as a medical treatment. CBD-based treatments have shown some promising results for reducing seizures in children with severe epilepsies.
Medical trials have largely focussed on pharmacological preparations, but some parents of children with epilepsy have been buying oils containing CBD and THC. There is currently little scientific evidence on the safety and effectiveness of these oils as a treatment for epilepsy, although they do contain the same active ingredients. In UK, there is a cannabis-based spray that can be used to treat muscle stiffness and spasms in people with multiple sclerosis.
CBD, one of more than 100 chemicals in cannabis, is emerging as a popular wellness ingredient. The plant extract, often consumed as an oil under the tongue, is now the featured ingredient in high-end products including coconut oil, body lotion, face serum, olive oil, jam, bath scrub, cold brew coffee, sports salve, lip balm, infused water, gummy snacks.
What is in cannabis drinks?
Drinks can be infused with cannabidiol, tetrahydrocannabinol or both. CBD is one of the hundreds of compounds found in marijuana plants and contains less than 0.1 per cent THC, the primary ingredient that gets you high. If cannabis is the active ingredient, drinks need not contain alcohol.
For example – beer without alcohol can be infused with ingredients of cannabis. CBD is considered to be having anti-inflammatory and mood-uplifting properties.
The taste of the cannabis drinks will depend on the flavour one buys – beer taste, fruit favour, and coffee drink. In the US, apple-flavoured cannabis-infused drinks are common and these taste like fresh apples in a bottle.
Cannabis-infused drinks in USA and Canada
An American survey has revealed that millennials drink far less alcohol than past generations. The share of college students who drink alcohol daily fell from 4.3% in 2016 to 2.2% in 2017, a more than 4 percentage-point drop from the 6.5% of college students who used alcohol daily in 1980.
Recreational cannabis was a $6 billion industry in 2016. It is projected to increase more than 700% to $50 billion in annual legal sales by 2026, according to financial firm Cowen and Co. To attract millennials, cannabis companies have to position their drink as a lifestyle drink. The intention is to seamlessly fit the product into an individual’s lifestyle instead of the other way around.
This new-found excitement for cannabis-infused drinks has also to do with the fact that millennials are turning away from mass market alcohol. Marijuana seems to be replacing alcohol as a means for relaxation.
Americans are now consuming gummy candies with cannabidiol, a chemical component of marijuana that is legal and does not intoxicate users. Unlike alcohol, consuming cannabis-infused drinks does not lead to a hangover. Nine states and Washington, D.C. have legalised recreational marijuana. Even more states allow products containing CBD, the non-psychoactive component of cannabis that some clinical trials have shown may help with anxiety and muscle pain without making users high.
The new cannabis industry is not just for young people, either. Cannabis products are increasingly targeting mothers in need of relaxation. In fact, elderly Americans are the fastest-growing demographic for marijuana use.
The Drug Enforcement Administration said that it now places FDA-approved drugs with CBD in “Schedule V,” defined as having the lowest potential for abuse, such as over-the-counter treatments for diarrhoea and cough suppressants. Cannabis itself remains a Schedule I drug, which places it alongside heroin and LSD as substances that are fully banned at the federal level. That classification has hampered the development of the US sector as companies are unable to have bank accounts that are federally insured, handing Canada a valuable first-mover advantage.
Canada is soon planning to legalise the use of marijuana. This has created an intense buzz about cannabis-infused beverages. Beer giants in Canada are signing deals with Canadian marijuana producers. In Canada, cannabis-infused drinks can be expected on the shelves only in 2019. The federal government said that regulating edibles is a complex affair and the potential health risks need careful understanding and evaluation.
Canadian government has made it clear that cannabis-infused drinks would not be available in liquor stores. Instead they will be available in stores that are regulated by governments.
What do other countries do?
Besides US and Canada, Germany, Italy and the Netherlands have legalised the use of medicinal cannabis. Uruguay legalised the recreational use of cannabis in 2013 with people allowed to grow up to six plants at home for personal use. In Spain, it is legal to use cannabis in private places and cultivate plants for personal use. Cannabis use in the Netherlands is technically illegal but possession of up to 5g (0.2oz) for personal use is decriminalised.
Recreational use is also decriminalised in several other countries, including Australia, Brazil, Colombia, Jamaica and Luxembourg.
The market for cannabis-infused drinks
Marijuana research firm GreenWave Advisors anticipates that the CBD industry could reach $3 billion by 2021 and eventually well over $200 billion in the US.
The total cannabis market, for both legal and illegal products, is around $150 billion globally, according to Euromonitor. Non-psychoactive CBD is the main ingredient in marijuana that is considered to be beneficial to health. This has prompted Coca-Cola to venture into manufacture of cannabis-infused drinks. As legal weed becomes more widespread, it is expected that more beverage companies will get into the business of marijuana. Beverage companies see the opportunity of cannabis to compete with alcohol. This, they hope, will ensure a steady growth in sales.
Alcohol companies that do not adapt to this new reality risk being suffocated by the growing demand for cannabis.
Reason cannabis drinks are gaining popularity
Cannabidiol, a constituent of cannabis, can help ease inflammation, pain and cramping, but has no psychoactive effect. CBD is a non-psychoactive component of marijuana that is being used in drinks and beverages as a health boost. The beer industry has proved especially interested, given the growing evidence that people are using cannabis to replace alcohol, while big soda companies are turning to CBD to build out their wellness offerings at a time when consumers are avoiding sugar.
Some studies have shown marijuana can help deal with epilepsy and anxiety. Regular use of cannabis can lead to decreased IQ and increased paranoia. People who start using cannabis at a young age show a higher risk of schizophrenia-like psychosis. People who begin smoking marijuana as teenagers also are four times more likely to become addicted. Despite this, many see it as a healthy alternative to alcohol.
The other side of cannabis-infused drinks
Regular recreational cannabis use increases the risk of developing a psychotic illness, such as schizophrenia. This risk is higher if it is used by teenagers and younger people as the drug interferes with development of the still-growing brain. Long-term use can also affect the ability to learn and concentrate.
Effects of using the drug can include a feeling of happiness and relaxation but it can also make users feel sick, faint and sleepy and cause memory loss. Withdrawal symptoms can include mood swings, restlessness and difficulty sleeping. It's argued that cannabis with high levels of THC can lead to people developing psychiatric issues.
There is sufficient evidence to show that people who use cannabis, particularly at a younger age, such as around the age of 15, have a higher than average risk of developing a psychotic illness, including schizophrenia or bipolar disorder.
To sum up
Cannabis-infused drinks are slowly gaining popularity because of their supposedly beneficial effects on health. But again more research is needed in this direction. In the West, cannabis-based drinks are seen as an alternative to alcoholic beverages. This development is bound to have an impact on the agricultural ecosystem in the West. Stricter regulatory enforcements may be needed to ensure that the use of cannabis does not turn into abuse.
Reference
https://www.bbc.com/news/uk-44531112
https://globalnews.ca/news/4461993/cannabis-infused-drinks-marijuana-legalization-canada/
https://www.bbc.com/news/business-45545233
https://www.marketwatch.com/story/millennials-appear-to-like-cannabis-more-than-booze-2018-09-26
https://www.usatoday.com/story/life/wellness/2018/10/05/cbd-cannabis-marijuana-therapy-wellness-food-pets/1459285002/
(The author works as associate professor[marketing & operations], Presidency School of Business, Bangalore)
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