Global Water-soluble CBD Market By Type (CBD Isolate, Full-Spectrum CBD, Broad-Spectrum CBD), By Form (Powder, Liquid), By Distribution Channel (Direct Sales/B2B, Indirect Sales/B2C, Supermarkets/Hypermarkets), By End-use (Food And Beverages, Personal Care and Cosmetics, Pharmaceuticals, Others) , By Region and Companies - Industry Segment Outlook, Market Assessment, Competition Scenario, Trends, and Forecast 2025-2034

Report Overview

The Global Water-soluble CBD Market size is expected to be worth around USD 4.7 Bn by 2034, from USD 1.3 Bn in 2024, growing at a CAGR of 13.7% during the forecast period from 2025 to 2034.

Water-soluble CBD is an innovative form of cannabidiol designed to enhance bioavailability and ease of incorporation into beverages, foods, and pharmaceuticals. Unlike traditional oil-based CBD, water-soluble CBD disperses easily in water-based formulations, unlocking wider applications across the food, beverage, nutraceutical, and cosmetic sectors.

According to the U.S. Food and Drug Administration (FDA), cannabidiol (CBD) derived from hemp containing less than 0.3% THC was legalized under the 2018 Farm Bill (Agricultural Improvement Act of 2018, Public Law No: 115-334), creating a foundational shift that opened CBD to mass-market commercialization. The FDA reports that nearly 60% of CBD users prefer edible or drinkable formats, a figure that significantly supports the adoption of water-soluble CBD.

In the current industrial scenario, water-soluble CBD is rapidly penetrating the functional beverage and health supplement industries. The U.S. Department of Agriculture (USDA) indicated that hemp cultivation acreage expanded from 32,000 acres in 2018 to nearly 146,000 acres in 2021. This surge in hemp farming has ensured a robust raw material supply chain for CBD processors, pushing many formulators to invest in advanced nanotechnology to enhance CBD’s water solubility and absorption rates. Furthermore, the European Food Safety Authority (EFSA) has recognized CBD as a “novel food,” provided safety evaluations are conducted, encouraging European companies to innovate safer, compliant water-soluble CBD products.

Several factors are driving the market’s momentum. Firstly, consumer demand for functional health products is escalating. According to the World Health Organization (WHO), 70% of adults globally are actively seeking preventive healthcare solutions, such as wellness supplements and fortified beverages.

Secondly, improved regulatory frameworks, such as the FDA’s draft guidance for evaluating cannabis-derived compounds in foods, are fostering safer product development pathways. Lastly, technological advancements, including microemulsion and liposomal delivery systems, are helping manufacturers achieve up to 5-10x higher bioavailability compared to oil-based CBD.

Key Takeaways

• Water-soluble CBD Market size is expected to be worth around USD 4.7 Bn by 2034, from USD 1.3 Bn in 2024, growing at a CAGR of 13.7%.
• Full-Spectrum CBD held a dominant market position, capturing more than a 45.3% share in the water-soluble CBD market.
• Powder held a dominant market position, capturing more than a 67.9% share in the water-soluble CBD market.
• Indirect Sales/B2C held a dominant market position, capturing more than a 57.4% share in the water-soluble CBD market.
• Food & Beverages held a dominant market position, capturing more than a 41.8% share in the water-soluble CBD market.
• North America stands as the dominant region in the global water-soluble CBD market, commanding a significant share of approximately 51.5%, equating to a market value of USD 0.6 billion in 2024.

By Type

Full-Spectrum CBD dominates with 45.3% due to its holistic wellness benefits and strong consumer preference.

In 2024, Full-Spectrum CBD held a dominant market position, capturing more than a 45.3% share in the water-soluble CBD market. Full-spectrum formulations are widely preferred because they contain a range of cannabinoids, terpenes, and flavonoids that work together to create the “entourage effect,” enhancing therapeutic outcomes. Consumers are increasingly looking for natural wellness solutions that offer comprehensive benefits, pushing the demand higher.

By 2025, Full-Spectrum CBD is projected to maintain its lead, driven by the rising awareness of full-plant extracts and supportive legalization frameworks. Additionally, companies are investing in advanced nano-emulsion technologies to boost the bioavailability of full-spectrum offerings, making them more attractive for use in beverages, capsules, and functional foods.

By Form

Powder form dominates with 67.9% due to its easy blending and longer shelf stability.

In 2024, Powder held a dominant market position, capturing more than a 67.9% share in the water-soluble CBD market. Powdered forms are favored by manufacturers because they offer excellent stability, easy transportation, and longer shelf life compared to liquid formats. The ability to blend seamlessly into a wide range of products like supplements, food, and instant beverages further boosted its adoption.

By 2025, Powder is expected to retain its strong position as food and beverage companies increasingly look for cost-effective, shelf-stable CBD ingredients that do not compromise product consistency or performance. Continuous improvements in microencapsulation technology are also making powdered water-soluble CBD even more efficient and desirable for large-scale applications.

By Distribution Channel

Indirect Sales/B2C dominates with 57.4% due to rising online platforms and direct brand marketing.

In 2024, Indirect Sales/B2C held a dominant market position, capturing more than a 57.4% share in the water-soluble CBD market. The popularity of online shopping platforms, health stores, and pharmacies has made it easier for consumers to access CBD products directly. Many brands are focusing heavily on digital marketing, influencer partnerships, and e-commerce to boost their visibility and sales. By 2025, Indirect Sales/B2C is expected to strengthen further as consumer trust in online CBD purchases grows, supported by improved product transparency, quality certifications, and easy doorstep delivery. The shift toward wellness-focused e-commerce trends is helping B2C channels lead over traditional direct distribution routes.

By End-use

Food & Beverages dominate with 41.8% due to increasing demand for wellness-focused consumable products.

In 2024, Food & Beverages held a dominant market position, capturing more than a 41.8% share in the water-soluble CBD market. The rising trend of infusing CBD into everyday items like sparkling water, coffee, snacks, and smoothies has fueled strong growth. Consumers are seeking convenient ways to add wellness products into their daily routines, making food and beverage applications extremely attractive. By 2025, Food & Beverages are expected to maintain leadership, supported by innovation in functional drinks and CBD-infused snacks. The easy absorption and enhanced bioavailability of water-soluble CBD make it a perfect fit for food developers looking to offer health benefits with appealing taste and texture.

Key Market Segments

By Type

• CBD Isolate
• Full-Spectrum CBD
• Broad-Spectrum CBD

By Form

• Powder
• Liquid

By Distribution Channel

• Direct Sales/B2B
• Indirect Sales/B2C
• Supermarkets/Hypermarkets
  • Specialty Stores
  • Online Retail
  • Others

By End-use

• Food & Beverages
  • Bakery & Confectionery
  • Nutraceuticals
  • Beverages
  • Others
• Personal Care & Cosmetics
  • Skin Care Products
  • Hair Care Products
  • Lip Care Products
  • Others
• Pharmaceuticals
• Others

Drivers

Consumer Demand for Wellness-Infused Foods and Beverages

One of the major driving factors for the water-soluble CBD market is the growing consumer demand for wellness-infused foods and beverages. As people become more health-conscious, they’re looking for products that not only satisfy hunger or thirst but also offer additional health benefits. Water-soluble CBD fits perfectly into this trend, as it can be easily incorporated into various consumables, providing potential therapeutic effects without altering taste or texture.​

In a study conducted by the Food Standards Agency (FSA) in the UK, it was found that a significant number of consumers are interested in CBD products, particularly those that can be consumed easily, such as edibles and beverages. The research highlighted that tinctures were the most common format, followed by e-liquids, pills/capsules, and creams/ointments. This indicates a clear preference for ingestible CBD products, which aligns with the capabilities of water-soluble CBD to be infused into drinks and foods. ​

Moreover, the FSA’s analysis of CBD products available in England and Wales revealed a diverse range of consumable CBD items, including oils, sprays, capsules, confectionery, and beverages. This diversity showcases the versatility of CBD, especially in its water-soluble form, to be integrated into various food and beverage products, meeting the evolving preferences of consumers seeking health and wellness benefits in their daily consumables. ​

The increasing consumer interest in health and wellness products, combined with the versatility of water-soluble CBD, suggests a promising future for this market segment. As more food and beverage companies explore the incorporation of CBD into their products, the demand for water-soluble CBD is expected to rise, driven by consumer preferences for convenient and health-enhancing consumables.

Restraints

Regulatory Uncertainty and Lack of Standardization

One of the major challenges facing the water-soluble CBD market is the inconsistent regulatory landscape, particularly in the United States. While the 2018 Farm Bill legalized hemp-derived CBD with less than 0.3% THC, the U.S. Food and Drug Administration (FDA) has not established clear guidelines for incorporating CBD into food and dietary supplements. In January 2023, the FDA concluded that existing regulatory frameworks are not suitable for CBD products and called on Congress to develop a new approach. This lack of federal oversight has led to a patchwork of state-specific regulations, creating confusion for both producers and consumers.

The absence of standardized testing methods exacerbates the issue. A Reuters report highlighted that cannabis testing regulations vary significantly across states, with differences in lab licensing, contaminant testing procedures, and acceptable levels of substances like pesticides and heavy metals. Such inconsistencies can lead to products being recalled in one state while remaining on shelves in another, undermining consumer confidence and posing financial risks to businesses. ​

In Europe, the situation is similarly complex. Although CBD products not authorized as novel foods are technically illegal under EU law, enforcement remains inconsistent. National food safety authorities have the means to take action against unauthorized products, but the popularity of CBD and challenges in regulating online marketplaces complicate enforcement efforts.

These regulatory ambiguities hinder the growth of the water-soluble CBD market. Manufacturers face difficulties in product development, labeling, and marketing, while consumers are left uncertain about product quality and safety. Until a cohesive regulatory framework is established, these challenges will continue to restrain market expansion.

Opportunity

Expanding Functional Food and Beverage Markets Drive Demand for Water-Soluble CBD

One of the most promising growth opportunities for the water-soluble CBD market lies in the expanding functional food and beverage sectors. As consumers increasingly seek products that offer health benefits beyond basic nutrition, the demand for functional ingredients like CBD has surged. Water-soluble CBD, with its enhanced bioavailability and ease of incorporation into various consumables, is well-positioned to meet this demand.​

In Thailand, for instance, the beverage industry is projected to reach USD 6.74 billion by 2025, driven by domestic consumption and a growing interest in health-oriented products. Notably, “future food” exports, which include functional foods, accounted for USD 3.97 billion in 2023, representing 9% of all food exports. Within this category, functional foods and ingredients dominated, making up 89.5% of future food exports. This trend underscores the global shift towards health-enhancing consumables, creating a fertile ground for water-soluble CBD products.​

In the United States, the National Institute of Food and Agriculture (NIFA) has initiated research to explore market opportunities for novel hemp-based products, including those suitable for food and beverage applications. This initiative aims to analyze consumer demand and preferences, providing valuable insights for stakeholders in the hemp industry. Such government-backed research highlights the potential of hemp-derived ingredients like water-soluble CBD in the functional food and beverage markets.​

Moreover, the U.S. Food and Drug Administration (FDA) continues to evaluate the regulatory framework for cannabis-derived products, including CBD. While current regulations are evolving, the FDA’s ongoing efforts to establish clear guidelines indicate a growing recognition of CBD’s potential in various applications. As regulatory clarity improves, it is expected to facilitate the integration of water-soluble CBD into mainstream food and beverage products.

Trends

Rising Popularity of CBD-Infused Beverages

A significant trend shaping the water-soluble CBD market is the increasing consumer preference for CBD-infused beverages. These drinks, ranging from sparkling waters to teas and coffees, offer a convenient and enjoyable way for individuals to incorporate CBD into their daily routines. The appeal lies in the combination of wellness benefits and the familiar act of consuming a beverage, making it an accessible option for both new and seasoned CBD users.​

Government initiatives are also playing a role in this trend. For instance, the U.S. Food and Drug Administration (FDA) continues to evaluate the regulatory framework for cannabis-derived products, including CBD. While current regulations are evolving, the FDA’s ongoing efforts to establish clear guidelines indicate a growing recognition of CBD’s potential in various applications. ​

Regional Analysis

North America stands as the dominant region in the global water-soluble CBD market, commanding a significant share of approximately 51.5%, equating to a market value of USD 0.6 billion in 2024. This dominance is attributed to the region’s progressive regulatory environment, heightened consumer awareness, and a robust infrastructure supporting CBD product development and distribution.​

Canada follows closely, benefiting from nationwide legalization of cannabis and its derivatives, which has fostered a conducive environment for CBD product innovation and commercialization. The Canadian market’s openness has attracted significant investments, leading to a diversified range of water-soluble CBD products catering to various consumer needs.​

The region’s market growth is further propelled by the increasing demand for health and wellness products, with consumers seeking natural alternatives for pain relief, anxiety reduction, and overall well-being. Water-soluble CBD products, known for their enhanced bioavailability and faster onset of action, have gained popularity in various applications, including beverages, nutraceuticals, and personal care products.

Key Regions and Countries

• North America
  • US
  • Canada
• Europe
  • Germany
  • France
  • The UK
  • Spain
  • Italy
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • South Korea
  • India
  • Australia
  • Rest of APAC
• Latin America
  • Brazil
  • Mexico
  • Rest of Latin America
• Middle East & Africa
  • GCC
  • South Africa
  • Rest of MEA

Key Players Analysis

Isodiol International Inc is a major player in the water-soluble CBD market, known for its pharmaceutical-grade CBD products. The company focuses on nano-technology to create highly bioavailable water-soluble CBD solutions. In 2024, Isodiol expanded its portfolio with beverages, skincare, and nutraceuticals containing water-soluble CBD. Strong partnerships in North America and Latin America have helped the brand strengthen its distribution network. Its continuous investment in patented delivery systems positions it as a leader in the fast-evolving CBD industry.

Prinova Group LLC is a key supplier of water-soluble CBD ingredients, specializing in custom nutrient premixes and functional beverage solutions. In 2024, the company enhanced its CBD ingredient offerings with advanced microencapsulation techniques for improved stability and taste. Prinova’s extensive global sourcing network and formulation expertise help it cater to the growing demand for CBD-infused foods and drinks. Its strategic collaborations with food and beverage brands make it a strong influencer in shaping product innovation across the CBD sector.

CBD Hemp Experts operates as a major manufacturer and private label supplier for water-soluble CBD products. In 2024, the company introduced several ready-to-market CBD drink powders, tinctures, and wellness shots using nano-CBD technology. With a 100,000 square-foot manufacturing facility compliant with cGMP standards, they offer scalable production for businesses globally. CBD Hemp Experts’ strong focus on quality assurance, third-party lab testing, and broad customization options makes it a preferred partner for brands entering the CBD space.

Top Key Players in the Market

• Isodiol International Inc
• Prinova Group LLC
• CBD Hemp Experts
• OROCAN GmbH
• Le Herbe, Inc.
• International CBD Supply
• Simply Soluble CBD
• Hanma Investment Group Co., Ltd. (HMI Group)
• Elixinol LLC
• Nuleaf Naturals LLC
• BIOTA Biosciences LLC
• Arvanna LLC
• Isan Global
• Beneficial Blends
• Other Key Players

Recent Developments

In 2024, Prinova Group LLC strengthened its role in the water-soluble CBD market through its proprietary HydroBond CBD™ technology. This innovation offers a highly soluble, clean-tasting CBD ingredient, ideal for functional beverages and wellness products.

In 2024, CBD Hemp Experts continued to strengthen its position in the water-soluble CBD market by offering a diverse range of products tailored to the growing demand for wellness-focused consumables.

Report Scope