Why is CBD so expensive? Here’s a breakdown on what makes a CBD oil worth your money.
Savvy CBD oil shoppers will have already noticed the vast and confusing range of CBD oil prices. There are CBD oils for thirty dollars or less and then the same size can sell for over a hundred dollars. The ingredients may be the same, and the extraction method, and even the milligrams per dose, but there is a confounding price difference from one brand and another. Is there a real difference between these CBD products? What’s the rationale for price difference? And why is CBD oil so expensive?
Despite some recent crackdowns by the Food and Drug Administration on the CBD industry, it still operates like the wild west. Aside from a few basic guidelines on medical claims, there is little to no oversight about what goes into a bottle of CBD oil. That means no standard dose, no max dosage per bottle, and no standards about quality. Many consumers have been left bewildered and frustrated by the astronomical prices. What is going on inside a CBD oil that makes it so expensive?
The Numbers: How Expensive is CBD, Really?
The CBD industry is on course to break records over the coming years. According to a press release from the Brightfield Group, CBD experienced a 700 percent increase in 2019. They also predict that the American market alone will reach close to twenty-four billion dollars by 2023. Tinctures, topicals, and CBD-infused beauty products continue to dominate the most profitable subsectors within the CBD oil industry. This should come as no surprise, as these are commonly the most expensive CBD products.
But market numbers don’t explain why CBD oil is so expensive for the average consumer. Here’s what we know for sure.
The Cost of Hemp Flower and Extraction
Growing hemp is an exciting new venture for American farmers because they can often sell their crops for more profit than corn or soy. On average, farmers can sell their hemp harvest for roughly $0.65 per gram. If that CBD-rich flower went straight to a consumer, the final retail price would be somewhere in the range of $8.00 to $15.00 per gram, or $224 to $420 an ounce, depending on location. These are pretty standard prices, especially compared with medical cannabis.
The next step in the process is the extraction of CBD oil from the pure hemp flower. Certainly, extraction technology contributes to the reason for expensive CBD oil prices. Trendscan reports the cost for the extraction process seems to be around $0.05 a gram (or $0.0005 per milligram) according to estimates based on Aphria’s numbers. When we follow that same extraction through the supply chain to the consumer, the final price is $0.06 per milligram according to a Leafly analysis. That equates to $2,835 per ounce. As a comparison, at the time of writing, gold is $1,615 per ounce.
Why is CBD so Expensive?
With all those numbers laid out, it still doesn’t cost nearly as much to make CBD oil as producers claim. So what gives? A quick search for “Why is CBD oil so expensive” will bring search results flooded by blog posts from CBD brands explaining the high cost of processing CBD. Interestingly these posts have few actual details about numbers.
Without naming names (as readers can find this out for themselves), these brands describe an expensive industry where premium CBD prices take into account testing, organic growing, and extraction processes. There is also the cost of maintaining an e-commerce store or bricks and mortar space plus employees to sell and market that CBD oil.
Why is CBD oil so expensive? The answer is: CBD oil is expensive because the market bears the weight of it. Truthfully, consumer demand and willingness to spend produce a wide range in prices. What consumers need to be cautious of is if that price is represented by formula, CBD content, grow methods, care of product. Unfortunately, with a stylish label and smart marketing, a less than average bottle of CBD oil can sell for a ridiculous markup.
This markup, which Leafly estimated was 400 percent or more, leaves the consumer with a bad taste in their mouth. CBD oil may be beneficial for symptoms related of many medical concerns, but it’s no miracle cure. Combined with false marketing, it’s no wonder the words “CBD” and “snake oil” are increasingly used in the same sentence.
How to Get the Most Bang for Your Buck
Thankfully, CBD oil isn’t snake oil, even if sometimes the marketing tactics would suggest otherwise. There is enough established research to confirm CBD has several potent therapeutic applications, with much more research coming down the pipeline.
But as a CBD oil consumer, how can you avoid the markup and still source high-quality, CBD-rich, products?
- Go Back to Basics: you can save money by sticking to good old fashioned flower. If smoking, vaping, or baking is an option for you, CBD-rich cannabis averages around $10 per gram.
- Read the Label: If you prefer CBD oils (or need larger daily doses), ensure you read the label. No matter what product you settle on, make sure it’s full (or broad) spectrum, organic, and contains healthy ingredients.
- Ask for a Lab Analysis: Weed out any disreputable CBD oils by asking for batch specific lab assessments. This data sheet confirms exactly how much CBD it contains (along with other beneficial compounds), as well as any lingering contaminants. If the product doesn’t offer a batch specific lab test, it’s not worth the money.
- Calculate Cost per Milligram of CBD: During your CBD label inspection, do the math. That means finding out how many milligrams of CBD the entire bottle contains. Divide that by the total cost of the bottle to determine how much you are paying per milligram. So long as the CBD oil checks all the other boxes (lab analysis, full-spectrum, organic), base your decision on the price per milligram of CBD.
It’s Expensive But is it Worth it?
Why is CBD oil so expensive? It boils down to two things: a lack of regulation and consumer demand. With anyone and everyone getting on board the CBD train, but little oversight, there is a lot of room for people to jack up prices for an inferior product. Don’t be sucked in my unsubstantiated medical claims designed to cheat the customer.
A general lack of official regulation on dosing, potency, production, and language makes purchasers vulnerable. It’s increasingly difficult for the average person to weed out the good products from the bad, which means it’s also hard to figure out if the CBD oil is worth the sticker price. And if you find a good, reliable brand share that information with other people. We’re all in this healing thing together.