by The US cannabis testing services market comprises analytical testing services for cannabis and related products. Testing services ensure safety of cannabis products by detecting contaminants such as heavy metals, pesticides, microbials as well as potency of cannabinoids such as THC and CBD. Laboratories providing cannabis testing services employ analytical techniques such as high performance liquid chromatography (HPLC), gas chromatography (GC), UV spectroscopy etc. to analyze cannabis samples. Stringent regulations on cannabis products require mandatory testing at various stages of production and distribution to ensure quality and potency. This drives demand for cannabis testing services in the US market.
The global US Cannabis Testing Services Market is estimated to be valued at US$ 1.87 Bn in 2023 and is expected to exhibit a CAGR of 16 % over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
The US cannabis testing services market is witnessing growing demand for residual solvent analysis. Residual solvent testing determines solvent levels in cannabis concentrates and extracts to ensure they meet safety guidelines. High levels of residual solvents can lead to harm when inhaled or ingested. Testing helps producers remove contaminating solvents and distribute clean products. Moreover, proliferation of cannabis-infused edible products is fueling demand for cannabinoid potency testing. Edibles require accurate cannabinoid content declaration as effects can vary greatly depending on dosage. Testing guarantees consistent potency and safe consumption of edible cannabis items.
Porter’s Analysis:
Threat of new entrants: The threat of new entrants is moderate as setting up new cannabis testing services facilities require high initial investments and regulatory clearances.However, ongoing legalization of cannabis across North America supports market entry.
Bargaining power of buyers: The bargaining power of buyers is high given the presence of several testing services providers and availability of substitutes. Buyers can negotiate on price and quality standards.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as key raw material and technology suppliers have established presence. However, testing equipment providers operate in an oligopolistic market.
Threat of new substitutes: The threat of new substitutes is low as cannabis testing requires specialized equipment and techniques for ensuring product safety and potency compliance. However, at-home cannabis potency and contaminant testing kits present a nascent substitute threat.
Competitive rivalry: The competitive rivalry is high due to increasing number of testing facilities and compliance requirements. Players compete on regulatory approvals, certifications, technology, and pricing.
Key Takeaways:
The US Cannabis Testing Services Market Size is expected to witness a CAGR of 16% over the forecast period, driven by the ongoing legalization of cannabis across various US states. The growing demand for testing of cannabis and cannabis products for ensuring product safety and compliance with regulations will support the market growth.
Regional analysis: The western US region currently dominates the US cannabis testing services market owing to the large cultivator base and demand from states like California. States like Colorado and Washington also contribute significantly. The northeast region is expected to be the fastest growing market led by increasing adoption in states like Massachusetts and New York.
Key players: Key players operating in the US cannabis testing services market are Saskatchewan Research Council (SRC), SC Labs, Steep Hill, Inc., SGS Canada Inc., CW ANALYTICAL and PharmLabs. These players are focusing on strengthening their testing capabilities and obtaining certifications to cater to the growing demand. GreenLeaf Lab and Eurofins Scientific also have a strong presence in the US market through their acquisition of regional players.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
