CBD extract is the latest trendy ingredient to take the food and beverage world by storm. But is cannabis-infused food and drink a fad? Or will CBD products be a staple in 2021?

What is CBD?

Products made with hemp-derived ingredients have always been popular. Hemp flour, cold press oils, seeds and protein powder have been popular food staples for years. But now all eyes are falling onto cannabidiol, or CBD, which is a non-hallucinogenic product of the cannabis plant. They are selectively extracted, concentrating CBD and removing or reducing other chemical components. This process means the final product is technically different from hemp.

Increasing Demand for CBD

The National Restaurant Association and the American Culinary Federation surveyed 650 professional chefs about their favourite culinary concepts. And interestingly they found that 3 in 4 chefs listed CBD, and cannabis-infused food, as a hot trend. The CBD market is certainly growing fast, with sales of nearly $25 billion expected worldwide by 2025 according to Grandview Research.

However, due to CBD’s association with cannabis, its arrival on the market has not been smooth. A big turning point came in 2018, when the US president signed the Farmer’s Bill to legalise CBD derived from the hemp plant, making it legally available. However, the ‘novel food status’ of CBD extracts was confirmed in January 2019, and the Novel Foods Catalogue was updated to reflect this change. This means companies operating in the space, within the UE, now must seek EFSA approval to continue using it. However, many argue that it is only a matter of time before regulatory barriers are removed. Accordingly to New Food Magazine, “while CBD from hemp in particular is legal in most markets, the regulatory landscape detailing how it can be included in food and beverage is a patchwork of sometimes contradictory and opaque rules – even in big markets like the US and Europe. Regulators have been moving sluggishly in their attempts to clarify matters, yet many brands have been rushing full speed ahead”.

Health Benefits

Legal ambiguity aside, incorporating CBD food into your business provides an incredible marketing opportunity. A reason behind the increasing demand for CBD in food and beverage products is the health benefits associated with it. CBD has been shown to help patients suffering from diseases including as cancer, arthritis, and epilepsy. And its healing properties certainly make it a popular choice with those seeking a healthy lifestyle. The demand for CBD infused snacks has shot up in the market due to the therapeutic benefits of the ingredient. Leading snack market players include ZBD, LivityFoods LLC, VELOBAR, Naturebox, Weller, Evo Hemp, CBD American Shaman, Dixie Brands Inc., Premium Jane, Pure Kana, and Just CBD. During COVID-19, consumers have placed a stronger emphasis on staying healthy and strengthening their immune systems. This has driven demand for all health and wellness focused products, such as CBD snacks. 

CBD, Demand Planning and Traceability

Demand planning is a process designed to maximize profitability. CBD supply chains need to be as efficient as possible. Accurate demand planning is the means by which food and beverage manufactures can ensure supply chains are efficient for inventory and, ultimately, revenue. Because of CBD’s somewhat confusing regulatory architecture, demand planning, traceability and ERP software is an incredibly important business tool. The FDA’s increasingly enhanced baseline traceability record keeping can be a challenge for manufacturers. However CBD traceability software, powered by AI and machine learning, can establish and maintain records containing Key Data Elements (KDEs) associated with different Critical Tracking Events (CTEs). 

There are a number of careful considerations to be made to ensure you become a responsible CBD food and beverage manufacturer.  If your food and beverage company is looking to scale and grow via ERP solutions, traceability and demand planing software, get in touch with the industry’s leading innovator, Cashmere, today.