You are currently viewing An Up-Close Look at the Value of Cannabis Extracts for Manufacturers

An Up-Close Look at the Value of Cannabis Extracts for Manufacturers

From dry flower to liquid cannabis extract, the legal cannabis market is ripe with the potential to develop a stellar business plan and turn a substantial profit. Over half of the United States now has legalized either recreational or medical cannabis, and hemp-derived products are legal across the board. Therefore, those willing to invest in grow operations and cannabis extraction equipment have a lot of room to step into the market.

While cannabis flower is certainly a popular product, cannabis extract products also have their place in the market. Cannabis in extracted form offers an easier-to-dose, socially acceptable way for people to get the cannabinoids they desire. So, is it worth building a business model around cannabis extract? We’re confident the answer is yes. Let’s take a closer look at the value of cannabis extracts for product manufacturers.

First, what is cannabis extract?

Cannabis extracts are created by extracting the most desirable parts of the cannabis plant from the unnecessary plant matter. Those valuable components include cannabinoids like delta-9-tetrahydrocannabinol (THC) and cannabidiol (CBD), but also terpenes, which give plants their unique aromatic and flavor profiles.

Extracting the valuable portions of the cannabis plant is no new idea; archaeological digs have turned up evidence that ancient Indian cultures created their own concentrates by brewing cannabis. However, the methodologies used in cannabis extraction have obviously grown to be more sophisticated, clean, and effective. From CO2 and solvents to cryo-ethanol, numerous processes have been found to be effective for creating high-quality extracts.

The Most Popular Types of Cannabis Extract Products Today

When cannabis is processed through extraction, the end result is a versatile, valuable product that is rich in cannabinoids. While extracts may be used to create cannabis-derived oils, a few other popular cannabis extract products include:

  • Vape cartridges
  • Cannabis concentrates
  • Topical cannabis products
  • Cannabinoid-infused edibles

Cannabis Extracts for Processors and Manufacturers: The Top Benefits

Cannabis processors and manufacturers gain quite a few advantages by working with cannabis extracts. Here is a look at some of those benefits.

1. Profitability

Between 2016 and 2027, some market research analysts have projected the cannabis extract market to see a CAGR of 16.6%. By 2019, the market was already valued at $7.3 billion. In 2018, sales of cannabis flower actually fell below 40 percent of the total cannabis market and extracts rose to over 60 percent. So, whether you are a processor looking solely at extracts, or a combination of extracts and other cannabis products, the potential for substantial profitability exists.

2. Product Versatility

As noted above, cannabis extracts can be transformed into a fascinating collection of other products. When you have the most valuable parts of cannabis in a liquid form, you gain this incredible versatility because you can move into creating cannabis-infused products. From selling just the basic extracts and incorporating those extracts into oils, to formulating health and beauty products or edibles infused with cannabinoids, you have a wealth of opportunity to create your own branded products. In a market that is filled with competition, creating your own unique product lines can make all the difference when it comes to profitability.

3. Ease of Packaging

Once you have separated the plant matter from the cannabinoids and terpenes, you have an easily manageable, compact product. Cannabis extracts are much simpler to package than standard flower. With this kind of in-depth information, you can package products with exact details on THC content.

4. Carve Your Own Niche in the Supply Chain

If you don’t necessarily want to use extracts to create your own products, you also have to keep in mind that just the extracts themselves are in high demand among others in the cannabis business. Numerous product developers prefer to purchase high-grade extracts from a processing company instead of extracting and processing the cannabis themselves. Therefore, you could easily create a nice niche for your company as a supplier in the larger scheme of cannabis products.

Find New Value for Your Cannabis Business with the Right Extraction Equipment

All things considered, you may feel it is time for you to step into the world of cannabis extracts. As you make the move, be sure you have the best-built botanical extraction equipment to yield a quality product. Reach out to us at Root Sciences to find out more about cannabis extraction and how we can help you get the perfect setup for your operation.