New Cannabis Products Which Could Disrupt the Industry in 2020

The cannabis industry enjoyed tremendous investor enthusiasm in 2018, fueled in large part by major developments which seemed to open up the space for new opportunities. Canadian legalization of recreational marijuana use, the continued adoption of legal medical or recreational cannabis in more states across the U.S., and high-profile achievements from some of the industry's emerging top contenders all fueled interest.

In spite of the fact that cannabis stocks overall failed to perform up to expectations last year, 2019 has already revealed continued anticipation regarding this growing industry.

Expanding Beyond Smoked Pot

If cannabis stocks are to thrive going forward, it's likely that many companies will have some growing up to do. Overextended balance sheets will need to be strengthened, highly speculative mergers and acquisitions must be kept in check, and quarterly figures will have to confirm that there is good reason for the hype surrounding these companies.

One way that up-and-coming marijuana businesses can bolster their fortunes in 2020 is through the release of new cannabis-based products. While it's true that there has already been a flood of new marijuana products to the market, it's likely that only a few will emerge as winners capable of driving sales and firming up particular companies' dominant status in this fledgling market. Below, we'll take a look at some new cannabis products which may be able to change the game in this way.

Edibles

If there is one large-scale category of cannabis product which is likely to emerge in 2020, it is edibles. When Canada moved to legalize recreational marijuana usage among adults, it did not include regulations for edibles and other products which might be confused for non-cannabis alternatives. The Canadian government allowed itself a one-year window from the initial legalization date of October 17, 2018 to sort out regulations for edibles products. In the meantime, Canadian marijuana companies have gotten a head start on developing new cannabis edibles for retail sale, even as retailers are giving away product that they are not yet allowed to sell. A recent government survey indicated that about a quarter of Canadian cannabis customers had received a free edible in the previous month.

Some 58 percent of likely consumers plan to purchase and use edibles, according to a recent survey by Deloitte. When Canadian edibles become legal for retail sale on or before October 17, 2019, expect a rush to get these products into retail shops. Edibles alone could become a billion-dollar industry in the years to come.

Cannabis Beverages

One of the biggest cannabis headlines of 2018 reported on news that Constellation Brands (STZ), the beverage company behind Corona and Modelo brand beers, had partnered with Canopy Growth Corp. (CGC), the largest cannabis producer in Canada. The alignment of a major cannabis company with a top producer of alcoholic beverages has many analysts and investors speculating that there could be joint product launches in the near future. Indeed, other pairs of companies have also matched up in recent months as well: Molson Coors announced a partnership with Canadian producer HEXO also.

It's unlikely that any existing products from companies like Constellation and Molson will change because of these partnerships. However, expect a THC-infused beverage market to crop up as a subcategory of the larger edibles space. These products could include THC- or cannabidiol (CBD)-infused juices, waters and seltzers or coffees. CBD products may be marketed as "health" drinks aimed at reducing anxiety and inflammation without generating a "high" feeling in the same way that THC does.

Cannabidiol (CBD) Products

Before 2018 was finished, CBD had already begun to make its way into all manner of products for sale. Although cannabis includes dozens of chemical components, CBD has emerged early on as a popular one for extraction and subsequent inclusion in drinks, vaping products, bath bombs and more. CBD has been marketed as a product with wide-ranging health benefits which can help to cure everything from pain to insomnia. While it's difficult to say exactly how accurate this claim is, it has nonetheless been sufficient to generate widespread interest in CBD, even among consumers not interested in the traditional "high" associated with cannabis. Expect a continued proliferation of CBD-based products in the months to come. Beauty and skin care products are among the most popular of these new offerings.

Cannabidiol has also made its way into drug treatments developed in the medical marijuana space. Indeed, the first FDA-approved cannabis-based drug makes use of a pharmaceutical CBD oil. Companies like GW Pharmaceuticals (GWPH) and Cara Therapeutics (CARA) are rushing to develop and test new CBD-based drug treatments. While this process takes a much longer time than the development of retail CBD-based products, it has the potential for tremendous industry-wide staying power, not to mention the benefit of providing more evidence of the efficacy of medical marijuana on a broader level.