Could 2023 be the Year of the UK CBD Market?

2023 the Year of UK CBD - GCI Content Hub - Global Cannabis Intelligence

As many brands across the UK move another step closer to having their novel food applications authorised, others will be looking dull-eyed at the Food Standards Agency’s (FSA) updated list of over 3,500 CBD products thinking: where to from here?

Without a spot on the FSA’s hallowed list, these might prove hairy times for business owners of brands stocking exclusively CBD products. As Emily Miles, Chief Executive of the FSA declared last month, “If a product is not on the list, it should be removed from sale because it is not attached to a credible application to us for market authorisation”.

Albeit the regulatory journey to compliance is not over for most brands featured on the FSA’s list (at the time of writing, only 57 of the 3536 products have been validated), business owners will be tentatively planning their next steps, whilst investors around the world might be playing close attention to said companies.

The Road to CBD Authorisation in the UK

The last hurdle for brands seeking novel food approval in the UK will be to have their submitted scientific evidence validated by the FSA, deeming their products safe for consumption.

As Miles continued, “’I want to emphasise that the FSA is not endorsing products on the public list, and inclusion on the list is no guarantee that they will be authorised as they have not yet been fully assessed for safety.

But we have taken the step of publishing the list so that local authorities, retailers and consumers can make informed judgments about what they stock and buy, as we gradually bring this growing market into compliance with the law.”

For most of these products full validation is unlikely to occur until 2023, as the FSA continues to conduct thorough risk assessments of novel food applications.

The UK CBD Market Following Novel Food Approval

The UK CBD market will be a fascinating one to watch over the next 18 months. A combination of increased retail interest in such products, re-energised marketing campaigns, and a new wave of investment might see demand and sales reach previously expected levels from the moment when cannabis-based products first burst onto the UK retail scene.

UK CBD Retailers

Whilst it is by no means uncommon to see CBD products on the shelves across highstreets in the UK, few big-name retailers have thrown their full weight behind products featuring this versatile cannabinoid, opting for a relatively incognito approach to stocking these CPGs.

Many flagship retailers in the UK have kept their powder relatively dry regarding their marketing of this product segment, but others have piled in with both feet, such as Holland & Barrett, hoping to steal a march on competitors slow to the party.

Speaking in conversation with Toby Gordon-Smith, CEO of CBD brand Grass & Co. at the most recent GCI Summit, Sophie Rose, VHMS Business Unit Director made clear that “our purpose at Holland & Barrett is to make health and wellness a way of life for everybody”.

Rose continued, stating that “accessibility is really key… We want to make it really easy for people to be able to take control of their health and wellness, and achieve their wellness goals”.

Separating the Wheat from the Chaff and Investing in UK CBD

It’s no secret that running and sustaining a CPG company is not easily achieved on a shoestring, something that many organisations will have experienced first-hand over the last two years of regulatory uncertainty and COVID’s decimation of ‘normal’ life.

With investment harder to come by under these conditions, a number of brands have unfortunately ceased operations over this period, and others will now be feeling the heat if they don’t see their names on the FSA’s list of CBD products.

However, the uncertainty of the last two years presented other companies an opportunity to take stock and innovate, perhaps creating further competitive advantages for themselves in the long run.

Given the protracted process of novel food applications in the UK, some organisations have taken the time to diversify their SKUs away from CBD, opting to create additional, non-cannabis-derived CPGs (for example, nutraceuticals) while they wait out the regulatory impasse.

Perhaps it will be these brands – with exposure to both canna-curious and more general wellness customers – that pique the interest of investors, looking to plant a flag in what is considered the most developed CBD market in Europe.

Or might it be others who have built significant communities across social media, or even companies with unique formulations working with third parties the validate and back up claims for their future marketing material?

Whether we see swathes of investment flow into the UK CBD market this year or next is still unknown. There may well be investors seeking concrete approval granted by the FSA before relinquishing the grasp on their purse strings; others might look to take a stake at a more favourable rate whilst there is still ambiguity in the air in 2022.

Either way, as the wheels continue to turn at FSA HQ and brands can envisage their novel food approval on the horizon, it surely won’t be long until we see an almighty push to drum up demand in UK CBD and assess whether it can match the hype of recent times.

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