Sales of CBD products are expected to get pretty high in the next few years, even if users of the products don’t.

A new forecast from the cannabis research firm BDSA predicts that U.S. sales of CBD products will hit $19.5 billion in 2025, rising at a compound annual growth rate of nearly 37%.

(For a different perspective on the CBD category, check out MMR’s virtual CBD Roundtable, which begins on page 19.)

BDSA is projecting that CBD sales will total $6.3 billion in 2021, according to Kelly Nielsen, the firm’s vice president of insights and analytics. That figure includes sales in all channels — dispensary, general retail and pharmaceutical — and is up from $4.1 billion in 2020.

Growth has been strong, but Nielsen says BDSA expects it to accelerate over the next few years. And the biggest change driving that faster growth will come when the Food and Drug Administration rules that ingestible products can be sold in general retail stores. Currently such sales are illegal, but there are signs that the FDA will change its position in the coming months.

“That is the change that would have the biggest impact on long-term growth,” Nielsen says. “We’ve seen percentage sales growth for several years, but that would spike the overall dollar sales volume to something far more substantial.”

BDSA predicts the FDA will approve CBD as a legal food additive in 2022, and suggests that move will bring traditional food and beverage brands, and major retailers, to the category. Nielsen said it would also accelerate a trend that is already under way — the shift of CBD product sales from dispensaries and into mainstream retail stores.

Nielsen notes that dispensaries accounted for about one-third of CBD product sales in 2020, and BDSA expects that share to fall to one-quarter in 2021 and to about 11% by 2026. The biggest beneficiaries of that shift, among brick-and-mortar retailers, at least, will be grocery and mass stores, according to BDSA.

The grocery channel accounted for only 4% of CBD product sales in 2020, and BDSA expects that figure to rise to about 7% in 2021. “But right now that’s pretty much limited to topical health and wellness products,” Nielsen says. “Ingestibles would really allow that to open up, and we expect 15% of volume to come through grocery in 2026.” Similarly, mass outlets currently account for less than 5% of CBD sales, but BDSA expects that to grow to 9% to 10% by 2026.

One thing that is not expected to change: Sales of CBD products are expected to continue to be driven by consumers seeking functional benefits, including pain relief, better sleep, and stress and anxiety management.