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This story originally appeared on Leaf Report
Legal cannabis companies and entrepreneurs have been incredibly successful selling plant-infused baked goods, chocolates, gummies, and ice cream. But the industry has so far fallen short in convincing users to try drinking their marijuana.
Now, as more states embrace legalization, some of the largest cannabis companies in the U.S. are looking to capitalize on a largely untapped marijuana beverage industry that could be worth billions of dollars.
“There’s so much versatility in what cannabis beverages have to offer,” said Chuck Smith, CEO of Denver-based Dixie Elixir – whose offerings include infused iced tea, berry lemonade and fruit punch drinks. “Many are appropriate for more settings than a beer or mixed drink would be.”
Seltzers, teas, colas, oh my!
There’s already a smorgasbord of cannabis beverages on the market, and the list of offerings continues to grow. Popular products include infused seltzers, teas, colas – and even alcohol-free beers, wines and cocktails. Some of the world’s largest booze companies – Anheuser-Busch, Pabst Brewing and Constellation Brands to name a few — have pumped investment dollars into drinkable marijuana. Even smaller, craft brewers like SweetWater and Lagunitas have dipped their feet into the business.
Cannabis beverage sales in the U.S. are projected to tally $421 million this year — more than double the total from 2019 — per Brightfield Group, a Chicago-based data firm that researches the marijuana and CBD industries. The firm expects the market for drinkable marijuana products to reach almost $1 billion by 2025.
Room for growth
Still, the beverage sector makes up less than 2 percent of the $20 billion legal cannabis industry.
“This is a category that can be moved dramatically if someone can get it right,” according to Bethany Gomez, Brightfield’s managing director – who spoke to Politico. “No one’s gotten it right yet.”
The majority of marijuana drinks are low in calories, and users almost never suffer the dreaded hangovers that alcohol can bring. But regulatory hurdles have thus far proven to be too large for some companies to overcome.
With cannabis still outlawed on the federal level, production, bottling and distribution operations are costly and must be set up in each state. On a more practically challenging level, most dispensaries still don’t have refrigerated display cases.
Many cannabis beverages, including those of Dixie Elixir, pack a THC punch that only regular users with a high tolerance can handle. In many western states, for example, a 12-ounce bottled drink can legally have up to 100 milligrams of the psychoactive compound.