In an article published by Euromonitor International in 2024, Japan’s cannabis regulations have experienced significant changes in recent years that have impacted the country’s cannabis market. 

One such change was the introduction of amendments to the Cannabis Control Law, which included the establishment of a new offense for cannabis use and the formal approval of Epidiolex, a medical CBD formulation, in 2023. While the law was amended and initially scheduled to take effect in October 2024, the law was not implemented until December. 

This postponement temporarily weakened expectations for the growth of the cannabis market for 2024; however, the current situation and future outlook of the cannabis market are expected to be still impacted by changing legal regulations. 

Japan’s Current Cannabis Market

Last May, the Ministry of Health, Labour and Welfare announced the THC standards for CBD products, announcing the standards for oil (10ppm), edibles (1ppm), and beverages (0.1ppm). Industry stakeholders raised concerns that these standards would hamper product development due to the degradation and chemical reactions of cannabinoids and the variations in test results. 

To battle these standards, companies have adopted a cautious approach to new entries and product handling, which has been a contributing factor to hindering the growth of the cannabis market. 

Despite current standards limiting the growth in Japan’s cannabis market, Euromonitor reported that the country’s legal CBD market reached JPY24.4 billion in 2024, with a 16.2% increase from the previous year and approximately 530,000 users. This growth was more subdued compared to previous research projections. However, growth is expected to resume, with THX residue limits and distribution and sales guidelines becoming clearer. 

Adding Diversity to the CBD Market

Currently, Japan’s CBD market primarily includes vapor products. Yet, in recent years, the country’s market has seen a diversification in product offerings, which provides topicals to relieve muscle pain or joint stiffness. Expanding market share, topicals are expected to grow because of their easy usage and noticeable effects. 

While sublingual tinctures are still a niche category, with many consumers unfamiliar with them, they offer an easier way to adjust dosage. Companies such as Taisho Pharmaceutical are entering the CBD supplements market, producing capsules and tablets that are gaining attention and expected to grow as functional food approvals expand. 

Also expected to help Japan’s cannabis market grow are beverages and edibles, such as gummies, whose convenience and affordability make them appealing CBD options. 

Japan’s Illicit Cannabis Market

While Japan’s legal CBD market has been slowly moving, the country’s illicit cannabis market reached roughly JPY64 billion in 2024, which is a 2.2.% increase from 2023. The legal reform’s delay limited the reduction of the illegal market, and the current situation, where over 70% of those arrested are under the age of 30, is essentially unchanged. 

With the illegal cannabis market showing growth, it is expected that stricter enforcement and revitalization of the legal CBD market will help curb the current situation. 

Euromonitor reported that, in 2025, the country’s cannabis market will still see an intersection between regulatory changes and market trends but is still expected to grow despite challenges. 

However, Japan’s CBD market needs to enhance industry transparency and create an environment where CBD users can feel confident achieving sustainable growth and attracting more consumer attention.