#BizTrends2025: South Africa’s cannabis market: preventing misuse or missed opportunities

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While these developments establish the framework or rules of the game — their influence is most notable in shifting consumer behaviours and market trends.

To this end, three key consumer trends stand out as central in shaping the future of the cannabis industry in South Africa.

Cannabis as an alternative medicine, aligning with health and wellness trends

The recent rescheduling of cannabis under the Medicines and Related Substances Act (MRSA) formally established the medical cannabis market, enabling healthcare providers to prescribe cannabis for therapeutic purposes to their patients.

As a result, the regulatory change facilitated growing consumer interest in cannabis-derived health and wellness products, particularly cannabidiol (CBD).

According to data from Euromonitor International, by 2024, the combined CBD and medical cannabis market will have a value of R470m. In turn, most of the market value was derived from consumers who increasingly explored cannabis as an alternative to traditional pharmaceuticals for managing conditions such as chronic pain, anxiety, and sleep disorders.

The acceptance of CBD as a non-intoxicating cannabinoid (compounds found in the cannabis plant) expanded its appeal among health-conscious consumers, who may be wary of the tetrahydrocannabinol (THC) cannabinoid and its effects.

This trend was further reflected in the proliferation of CBD-infused products, including oils, edibles, and topicals. More importantly, consumer demand extended beyond those with medical conditions and included consumers who prioritise their health and wellness.

Emergence of a social and lifestyle culture

Despite legislative restrictions, Euromonitor data shows the rise of cannabis outlets, and the historical prevalence of a substantial illicit market is estimated at R36bn by 2025, indicating strong consumer demand for recreational cannabis.

Demand for cannabis in South Africa is countrywide; however, the bulk of demand is derived from urban areas.

Cities like Johannesburg, Pretoria, Durban, and Cape Town are all becoming hubs for a budding cannabis culture, where private-use allowances under the Cannabis for Private Purposes Act (CPPA) have spurred a shift toward social consumption in private settings.

The CPPA, formally introduced in 2024, allows South Africans to grow, possess, and use cannabis in private spaces, with clear rules and penalties. However, it prohibits commercial cannabis transactions, focusing on private use and limiting the potential for a fully commercial market.

Cannabis is increasingly being positioned as a lifestyle product, similar to other vices, such as tobacco or alcohol. This trend drives demand for curated experiences, including cannabis clubs, cultivation workshops, and private events that create a sense of community across cannabis users.

Key stakeholders, including large corporations, cannabis advocacy groups, the agriculture sector, and entrepreneurs, are working to redefine cannabis consumption as a legitimate and socially integrated activity.

These stakeholders play a critical role in shaping perceptions and lobbying for more inclusive policies that accommodate a regulated but fully commercial market.

Increased awareness of legal boundaries and advocacy for reform

With extensive media coverage on the CPPA and other interconnected legislation, such as the Drugs and Drug Trafficking Act and the National Road Traffic Act, consumer awareness has improved around the legal nuances of cannabis use. As a result, two key impacts on consumer behaviour are notable.

First, it fosters caution among consumers who are wary of inadvertently violating the law, particularly when it comes to purchasing cannabis from retail outlets that operate in legal grey areas. This is because, despite heightened awareness, much like other markets, uncertainty will hinder the market’s full potential, as some consumers would rather be cautious than unintentionally violate current laws and regulations.

Legal and regulatory insights into South Africa’s growing medical cannabis market

Bassani Medical  2 Oct 2024

Second, increased awareness around cannabis policy is driving policy reform, particularly around adult-use cannabis, synonymous with the recreational market.

Consumers recognise the economic potential and employment provider of a regulated recreational market, projected by Euromonitor to reach R11bn by 2028, provided current legislation changes.

As a result, consumers and producers alike are increasingly pushing for policy amendments that are clear, fair and will not hamstring the largest revenue generator in the cannabis market.

The everchanging nature of cannabis policy

The interplay between evolving legislation and consumer behaviour will continue to shape the South African cannabis market. Health-conscious consumption, the emergence of a social and lifestyle cannabis culture, and increased consumer awareness and demand for policy reform are the defining consumer trends that will dictate the long-term outcome for South African cannabis policy.

While the CPPA serves as a cornerstone of this shift through the creation of a legal framework enabling private-use cannabis consumption, the challenges of transitioning to a fully commercial market remain under the current laws and regulations.

Going forward, the interactions between key cannabis stakeholders—along with their respective policy objectives—will dictate consumer behaviour and the long-term feasibility of a fully legal commercial market.