Coca-Cola says it is “closely watching” the use of CBD (Cannabidiol) as an ingredient in “wellness beverages” as a growing number of companies develop cannabis-infused drinks.
CBD is a cannabinoid that can be extracted from both marijuana and hemp varieties of cannabis. CBD doesn’t produce the high associated with marijuana, however, it is believed by many to have calming, anti-inflammatory and pain-relieving properties.
While Coca-Cola said it has “no interest in marijuana or cannabis,” they have stated: “Along with many others in the beverage industry, we are closely watching the growth of non-psychoactive CBD as an ingredient in functional wellness beverages around the world,” the company added. “The space is evolving quickly. No decisions have been made at this time.”
Coca-Cola released their statement after a report from Canada’s BNN Bloomberg reported that they were in “serious talks” with Aurora Cannabis, a medical marijuana producer and distributor, to develop drinks infused with CBD.
Following the BNN report, stocks for Aurora Cannabis spiked 17% and Coca-Cola’s shares rose slightly.
Aurora spokeswoman Heather MacGregor said her company “has expressed specific interest in the infused-beverage space and we intend to enter that market”.
CBD oil has boomed in popularity as a number of states and countries legalize the use of CBD, hemp and marijuana products. The CBD market is forecast to grow $2.1 billion by 2020 according to Hemp Business Journal.
Canadians can legally buy and consume cannabis starting October 17th. South Africa’s highest court has recently legalized the use of cannabis by adults in private places, although it remains illegal to sell, supply and use in public. The statement has been seen as a prelude to further legalization in the united states.
Coca-Cola has been diversifying their product portfolio with recent investments in sparkling water and coffee beverages. Demand for sugary sodas has declined each year over the last decade as consumers become more health conscious.
Beer giant Molson Coors announced on August 1st that they were teaming up with The Hydropothecary Corporation, a Canadian medical marijuana grower, to develop cannabis-infused non-alcoholic beverages. Although it likely that these beverages will not only contain CBD, but also THC, the cannabinoid that causes the high or buzz effect of marijuana.
Two weeks later, spirits company Constellation Brands announced a new $4 billion in investment in Canada’s Canopy Growth, a Canadian medical marijuana producer, in exchange for a 38% stake in the company.