Cannabis offers high road to growth for beverage makers

Posted by AFN Staff Writers on 2nd July 2018

SPARKLING water infused with tetrahydrocannabinol (THC), the active ingredient that causes the marijuana high, hits the shelves this week in California.

Lagunitas Brewing Company is launching Hi-Fi Hops, an “IPA-inspired” sparkling water containing zero calories and coming in two varieties – one with 10 milligrams of THC and one with five milligrams of THC and five grams of cannabidinol (CBD).

California legalised recreational marijuana in January, giving beverage makers like Lagunitas a new path to growth.

US experts say as more states legalise recreational marijuana, there are 10, established beer giants and craft newcomers are racing to develop cannabis-infused booze.

Interest in marijuana-based food and beverages is becoming increasingly mainstream, too, they say.

Legal marijuana sales reached $US9.7 billion in North America in 2017, and the market is expected to hit $US24.5 billion in sales by 2021, rising at CAGR of 28%, according to BDS analytics. US food industry publication Food Dive says though premium water may not seem like a vehicle for THC, consumers are interested in out-of-the-box varieties.

“Functional, fruit-infused, botanical and caffeinated sparkling water brands are being joined by hard seltzers, such as Boston Beer’s truly Spiked & Sparkling and Boathouse Brewing’s Spiked Seltzer,” Food Dive reports.

“Products like these have helped shift the category into adult beverage territory, and Lagunitas’ Hi-Fi Hops could be similarly well received.

“But the brand won’t enjoy the mainstream acceptance of its competitors’ hard sparkling waters — at least initially.

“Hi-Fi Hops will only be sold at California distilleries, so its consumer base is fairly niche.

“It will be interesting to see if the Heineken-owned brewer will roll out the product to other states where marijuana is legalised, and if its THC-based sparkling beverage has staying power.

“If it does make a splash in the category, which is on pace to reach $3.1 billion in sales by 2022, other beverage makers may try to capture some of the high for themselves.”