Glossary of Terms:
Cannabinoids: A group of substances found in the cannabis plant, primarily known for tetrahydrocannabinol (THC) and cannabidiol (CBD).
Tetrahydrocannabinol (THC): A cannabinoid known as the main psychoactive component of cannabis (marijuana) that acts on receptors in the brain to produce psychoactive effects.
Cannabidiol (CBD): A type of cannabinoid that does not produce psychoactive effects, unlike THC. Cannabidiol is also the main ingredient in Epidiolex, and has recently gained attention as a health food.
Current situation and prospects of Japan’s CBD market
In May 2024, the Ministry of Health, Labour and Welfare announced THC residue standards for CBD products for oil (10ppm), edibles (1ppm), and beverages (0.1ppm). However, industry stakeholders have raised concerns that these standards may hinder product development due to the degradation and chemical reactions of cannabinoids, as well as variations in test results. Consequently, companies have adopted a cautious approach to new entries and product handling, which has become a factor hindering the growth of the CBD market. Nevertheless, Euromonitor estimates that Japan’s legal CBD market reached JPY24.4 billion in 2024, with a 16.2% increase from the previous year and approximately 530,000 users. Although this growth is more subdued compared to previous research projections, growth is expected to resume from 2025 onwards as THC residue limits and distribution and sales guidelines become clearer.
Diversification of CBD products in the market
Currently, vapour products are mainstream in Japan’s CBD market but, in recent years, topicals aimed at relieving muscle pain or joint stiffness have been expanding their market share. Topicals are expected to grow due to their ease of use and noticeable effects, especially for beginners. Additionally, sublingual tinctures are easy in terms of adjusting the dosage, but they remain a niche category as many consumers are not yet familiar with this method of use. Capsules and tablets are also gaining attention, with companies such as Taisho Pharmaceutical entering the CBD supplements market. Despite challenges in quality control and food labelling, growth of these product types is expected as functional food approvals expand. Furthermore, beverages and edibles such as gummies are expected to expand the market due to their convenience and affordability, although attention must be paid to ensure THC residue standards do not become a barrier.
On the other hand, Japan’s illicit cannabis market reached approximately JPY64 billion in 2024, with a 2.2% increase from 2023. Although the legal reform was expected to act as a deterrent, the delay until December limited the reduction of the illicit market. The current situation, where more than 70% of arrestees are younger generations under 30, remains unchanged. Transactions in various forms, including cannabis flower, liquids, oils, and edibles such as gummies, have increased. It is expected that stricter enforcement and the revitalisation of the legal CBD market due to the legal reform will curb the current situation, in which many consumers have easy access to illicit cannabis products.
Summary and future outlook
In 2025, Japan’s cannabis market will be in a complex situation where regulatory changes and market trends intersect. The CBD market is still expected to grow, but the industry faces challenges related to stricter THC residue standards and product quality control. Meanwhile, the illicit cannabis market continues to grow slowly, with consumption among younger generations being particularly notable. For Japan’s CBD market to achieve sustainable growth and become an attractive option for consumers, it is crucial to enhance industry transparency and create an environment where consumers can use CBD products with confidence. In recent years, CBD products have gained attention for their relaxation and anti-inflammatory effects, but they have also been recognised with caution due to their cannabis-derived nature. The recent legal reform is expected to expand the options for medical use and establish clear safety indicators for products that meet the THC standards, thereby revitalising the market.
Learn more about market data and insight in our report, Cannabis in Japan.
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