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Why Is CBD So Expensive? Clarity On Volatility Of CBD Prices

Date 22nd Mar 2021

Why Is CBD So Expensive? Clarity On Volatility Of CBD Prices

Cannabidiol (CBD) is one of the primary active ingredients derived from the cannabis sativa plant. It's one of the fastest-growing industries expected to reach $1.8 billion by 2022 [1].

If you've spent any amount of time shopping for CBD at your local health store or online, I'm sure you've encountered wild price ranges and wondered, "Why is CBD so expensive?"

One of the reasons for the high price tag of many CBD oils is that manufacturers understand the importance of a premium hemp source, opting for organic farming practices, and other quality assurance measures to preserve the beneficial compounds' integrity in the final bottling stage.

In this article, we'll break down what goes into pricing a high-quality CBD oil and how you can tell the good brands from the bad to make sure you're going home with a product well worth your hard-earned cash.

Does CBD Really Do Anything?

Many people are reaching for CBD products for a gentle and natural supplement to support a wide range of health concerns.

CBD belongs to a class of phytochemicals known as cannabinoids that interact with our endocannabinoid system (ECS). The ECS is a regulator for other vital systems that are key to our survival, like stress, metabolism, hormones, and sleep.

CBD and other cannabinoids are produced in the plant's resin found in hair-like crystals on the flowers, leaves, and stems of mature cannabis plants. Both marijuana and hemp strains produce CBD, but most CBD oil on the market comes from hemp crops for its legal status and accessibility. 

Hemp Vs. Marijuana

Hemp is classified as a variety of cannabis plants with less than 0.3% THC (the primary cannabinoid responsible for the intoxicating high with recreational marijuana use). Although marijuana may provide similar benefits, its intoxicating effects aren't ideal for many users.

CBD oil is the concentrated compound extracted from cannabis that's often mixed with a CBD carrier oil such as hemp seed oil, olive oil, glycerin, or coconut oil to make it easier to dose and use.

These days, you can find CBD in everything from CBD oilsCBD softgelsCBD gummiesCBD lotionsCBD vapes, and CBD skincare.

If you've been shopping around, you'll notice the price of CBD varies significantly from product to product. The reason for this can be anything from the hemp quality, company research and innovation, third-party lab testing, marketing, and additional ingredients that can drive the price of a product.

THC-Free CBD Oil on a rock next to a dropper

The Cost Of CBD Oil Starts At The Seed

Why is CBD oil so expensive? We like to say that quality CBD products start from the seed

One of the biggest challenges in farming hemp for legal CBD oils is the THC limit of 0.3%. If farmers grow crops that contain more than 0.3% THC by dried weight, it becomes marijuana under the law and must be destroyed. The plant's genetic variability and its growing environment affect its expressed cannabinoids and terpenes, altering the final product's effects and flavor profile.

Hemp farming is a labor-intensive process. It requires regular inspection to maintain the legal THC threshold, up keeping many acres of land, and various state-required licensing to set up shop.

Another tricky factor in growing a high-quality hemp source is the farming practice. Cannabis is especially sensitive to its growing environment. The plant absorbs many compounds from its surroundings, which is a good thing if planted in healthy soil. However, it becomes problematic when the soil is contaminated with heavy metals or pesticides.

These harmful chemicals could possibly end up in the final CBD product, making it potentially dangerous to users with compromised immune systems [2]. 

a hemp farm with a red tractor on the side

Cannabinoid Extraction Methods Are Costly

Another reason why CBD oil is so expensive is due to the machinery and licensing involved in harvesting the compound.

Isolating the cannabinoids and terpenes from the large organic crop material requires a lot of resources (labor, machinery, licensing, facilities), especially when its conducted on a massive scale.

Traditionally, CBD oil is extracted using low heat and oil, but this won't work on an industrial scale, nor does it yield consistent, high-quality CBD. The two main ways manufacturers extract cannabinoids are through ethanol extraction or supercritical carbon dioxide (CO2).

Ethanol Extraction

Ethanol is plant-based alcohol made from the fermentation process. It's a commonly used solvent in cosmetics, food flavorings, and even medical preparations.Ethanol extraction method is one of the more popular methods for harvesting CBD and other cannabinoids.

According to the Food and Drug Administration (FDA), ethanol extraction is considered a safe practice when done correctly. It won't yield any negative consequences to the consumer, unlike butane extractions. Butane solvents are hazardous to work with, and bad-post processing can leave butane residue in the final product. Ethanol evaporates quickly, so it doesn't leave a harmful residue behind.

Thanks to ethanol's chemical composition, it effectively dissolves fat-soluble molecules, like cannabinoids and terpenes. This extraction method involves soaking raw hemp in ethanol to separate the resin trichomes from the buds, leaves, and stems.

This is a time-consuming process and requires expensive equipment to yield consistent, high-quality results. In comparison to supercritical CO2 extraction, ethanol extraction is significantly more expensive upfront. According to the Extraktab, it costs $4.71/lb for food-grade ethanol whereas food-grade CO2 comes in at $0.04/lb, which is why CO2 extraction may be more popular with small-batch CBD manufacturers [3]. 

Super Critical CO2 Extraction

CO2 is a naturally occurring gas as a by-product of cellular respiration, so it's much better for the environment and much safer to work with than other solvents. When CO2 is in a supercritical state (between a gas and a liquid), it behaves like a solvent.

This extraction process requires highly-specialized, expensive equipment and a state-registered facility.

Both methods mentioned can yield full spectrum hemp extracts, which are considered the most therapeutic form of CBD oils because they maintain much of the plant's natural terpene and cannabinoid profile, which can boost the benefits of CBD.

Further processing is required to isolate pure CBD or broad spectrum CBD extracts to guarantee a THC-free CBD. The price of full spectrum CBD tends to be higher than that of CBD isolates typically due to the supply and demand. Full spectrum CBD is recommended for therapeutic use as it contains more cannabinoids and terpenes that contribute to CBD's effects. 

neurogan CBD Oil 3000mg

Independent Lab Testing For Quality Assurance

Because the CBD industry is fairly new, it's often poorly regulated.

Not all brands on the market are held accountable for this step, but it protects users from potentially dangerous products [4].

Another reason premium CBD brands can justify their prices is due to CBD lab results.

Well-respected brands send a sample of every batch of product to an independent lab to ensure their hemp is free from harmful contaminants (heavy metals, pesticides, microbes, or residual solvents). This certificate of analysis report is posted on the company's website, giving customers peace of mind that their product is quality.

Here are the important components to pay attention to on a third-party (independent) lab test. 

Neurogan CBD Oil

The Amount Of CBD In The Product

Some companies charge a premium for only a sprinkle of CBD in their product. This is especially true in the cosmetic industry because of the lack of regulation. At such low CBD concentrations, you'll find yourself wondering "does CBD really do anything?"

For CBD to yield effects, you need to have a certain concentration in the ingredients list. The amount of CBD should be labeled on the bottle in milligrams for the entire product. According to the WHO, oral dose ranges from 100–800 mg per day are considered appropriate for therapeutic use [5].

A recent study of 84 CBD products purchased online showed that more than a quarter of the products contained less CBD than labeled [6]. Some brands have been found to mislabel the CBD content in their products. To make sure you're buying more than snake oil, always refer to the third-party lab report. 

The Amount Of THC In The Product

Hemp naturally contains traces of THC β€” but it must stay within the legal threshold of 0.3%, which isn't enough to produce intoxicating effects.

Still, it's important to verify your CBD products adhere to these THC limits to protect you from potential legal trouble or unwanted effects. If you're specifically shopping for isolate or broad spectrum CBD, make sure the certificate of analysis reads 0% for THC.

The Cannabinoid Profile (Extract Type)

Full spectrum or whole plant hemp extracts contain various elements found in hemp, including CBD, CBG, CBN, THC, terpenes, fatty acids, and plant esters that can contribute to the health benefits.

When CBD is combined with the naturally occurring phytochemical profile, it yields stronger effects with fewer chances of experiencing adverse effects. Full spectrum is considered the gold standard as a CBD health supplement.

Full spectrum extracts tend to cost more because manufacturers must be careful during the extractions to preserve temperature-sensitive compounds. We've come across brands advertising full spectrum products to justify the higher price point. However, it only contained CBD when the product underwent third-party testing. 

CBD Oil in production and manufacturing

Other Costs That Makes CBD So Expensive

Brands that are serious about the products they put out into the world spend many resources on product development, good manufacturing practices, and quality control measures to keep a high-quality product on the top shelf.

The CBD industry is highly competitive, which means companies that hope to stay in the game need to be constantly innovating upon their product line-up and providing their customers with consistent and reliable products that add value to their lives.

All of these considerations go into the pricing of CBD oils.

Unfortunately, there are way too many scam brands on the market looking to make a quick buck off of the green rush β€” but now that you understand what goes into pricing a high-quality CBD oil, you'll be more aware of what to look out for.

CBD Oil Drop

The Takeaway: Why Is CBD So Expensive?

Are the benefits of CBD oil worth the expense?

For many people, yes. CBD oil has become a staple part of their health regimen as an easy-to-incorporate, natural supplement to support sleep, stress, mood, and maintain a healthy active lifestyle.

There are a lot of costs involved in producing a high-quality hemp extract, and the demand for it is only rising.

Still, it's important to remember that not all cannabis plant-based products are made the same.

Before shopping with a brand, check their hemp source, the extraction process, and third-party lab reports, and look into the reputation of the brand itself online. With a bit of research, it's easy to tell the scammer brands from the real ones.

Happy shopping!

Resources:

  1. https://www.statista.com/statistics/760498/total-u...
  2. https://www.frontiersin.org/articles/10.3389/fphar...
  3. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC75162...
  4. https://extraktlab.com/supercritical-co2-extractor...
  5. https://www.who.int/medicines/access/controlled-su...
  6. https://www.mayoclinic.org/healthy-lifestyle/consu...


Disclaimer

The statements made regarding these products have not been evaluated by the Food and Drug Administration. These products are not intended to diagnose, treat, cure or prevent any disease. All information presented here is not meant as a substitute for or alternative to information from health care practitioners. Please consult your health care professional about potential interactions or other possible complications before using any product.

Katrina Lubiano
Katrina Lubiano

Katrina Lubiano is a content writer in the health and wellness space based in Vancouver, Canada β€” Canada's epicenter for cannabis culture. When she's not working, she enjoys sailing, watercolor painting, and cooking.