In regions where cannabis is legal, beer and wine companies are increasingly exploring marijuana-infused beverages and related products as a strategy to diversify their offerings and prevent the cannabis sector from monopolizing their customer base. Constellation Brands, the third-largest beer producer in the United States, announced in October that it was investing in a Canadian cannabis firm. The company plans to develop cannabis-infused beverages that are non-alcoholic, joining the growing market of marijuana-infused sodas, coffees, and fruit drinks available in U.S. states where cannabis is legalized.
Constellation is not the sole player in the alcoholic beverage market venturing into this arena. In September, Lagunitas Brewing introduced an IPA infused with marijuana terpenes, the aromatic compounds derived from the cannabis plant. This beer does not contain tetrahydrocannabinol (THC), the psychoactive compound known for inducing a euphoric high and altering reality. Beyond the innovation and diversification opportunities associated with cannabis products, there is a sense of, “If you can’t beat them, join them.” Beer and wine companies have little to lose and potentially significant gains to achieve if market value projections hold true. Moreover, entering the cannabis sector could help mitigate declining domestic beer sales, and there may be mergers and acquisitions opportunities given the numerous successful cannabis startups.
Cannabis poses a genuine threat to the beer industry, particularly as indicated by a joint survey conducted by IRI and CannaBiz Consumer Group, which revealed that 5% of adults would cease beer consumption if marijuana were legally accessible in their state. The beer market’s share in the overall alcohol market decreased by 0.3% to 49.2% in 2016, with the survey suggesting that recreational marijuana could divert 7.1% of the beer industry’s revenue. IRI analysts estimate that if cannabis were legalized nationwide in the U.S., the beer sector could face losses exceeding $2 billion.
With California now legalizing recreational marijuana, it becomes the eighth and largest state to do so. Additionally, five other states—Connecticut, Michigan, New Jersey, Rhode Island, and Vermont—are likely to follow suit this year, further expanding the market for marijuana and THC-infused beverages, edibles, and other related products. Furthermore, if Canada implements a nationwide legalization policy within the next year, the North American market could significantly broaden, and certain players within the alcohol industry seem ready to capitalize on this opportunity.
As these companies navigate this evolving landscape, they may also consider incorporating health-enhancing ingredients such as calcium citrate 1040 into their products, which could attract health-conscious consumers looking for innovative beverage choices.