Last year, Elev8 Brands, Inc. (OTCMKTS:VATE) launched an ambitious plan to exploit the CBD market. In particular, the firm would produce CBD-infused and ready to drink (RTD) beverages for sale to cannabis customers. In the first week of January 2019, Elev8 announced the commencement of production of CBD Iced Coffee and CBD Iced Tea.
The production commencement is a huge milestone
Notably, the CBD-infused RTD beverages sector has very few players and Elev8 hopes that this will give them an upper hand. Interestingly, the company believes that they have the advantage to exploit the more than $7.8 billion RTD tea market. In particular, the firm wants to target the population that terms itself tea and coffee drinkers.
According to Ryan Medico, CEO at Elev8, the commencement of production of the RTD teas is a huge milestone. Interestingly, Medico asserted that the production could not kick off at a better time. This is a reference to the expected exponential growth of the CBD market. Notably, a string of favorable legislation is pointing the market in the growth direction.
Elev8 is gearing up for expected CBD market growth
Interestingly, the 2018 Farm Bill is one of the major highlights for the US CBD market. The bill delists hemp from the category of controlled substances. As such, this technically means that it is legal to cultivate and process the crop into various products. Cannabidiol is a significant component of the crop, and its legalization implies that there will a flood in the supply of CBD. Fortunately, the market received the news well, and demand for CBD products is surging.
According to industry commentaries, the latest figures for CBD sales in the US totaled $820 million. The same commentaries assert that the market will expand to up to $1.9 billion in three years from 2019. Besides, the market will is projected to grow at 14.4% CAGR from last year to 2022.
As such, Elev8 is gearing up for the expected windfall. Notably, the firm acquired Blessed Bean Coffee, LLC which will facilitate the exploitation of the CBD market. Interestingly, Elev8 will pay Blessed Bean’s investors over 3.5 million of its common stock.