The Australia legal cannabis market encompasses medical cannabis, cannabinoid-based wellness products, and regulated industrial hemp, with recreational cannabis still under review in most jurisdictions. Australia’s legal cannabis sector is primarily driven by medicinal prescriptions for chronic pain, epilepsy, anxiety, and sleep disorders, alongside growing interest in CBD-based nutraceuticals and wellness offerings.
The country has become a global hub for cannabis cultivation, research, and exports, thanks to regulatory clarity, favourable climate conditions, and rising patient acceptance.In 2025, the legal cannabis market in Australia is projected to reach approximately USD 81,835.1 million, and is expected to grow to around USD 1,119,519 million by 2035, reflecting a Compound Annual Growth Rate (CAGR) of 29.9%.
| Metric | Value |
|---|---|
| Market Size in 2025 | USD 81,835.1 Million |
| Projected Market Size in 2035 | USD 1,119,519 Million |
| CAGR (2025 to 2035) | 29.9% |
In terms of source, the legal cannabis market in Australia is segmented into marijuana and hemp. Marijuana dominates the market due to its widespread use in medical treatments under the nation’s prescription framework. It contains higher concentrations of psychoactive compounds like THC, making it suitable for conditions requiring potent therapeutic effects such as cancer-related symptoms and neurological disorders.
The Australian government has allowed licensed producers to cultivate marijuana under strict quality controls, leading to consistent product availability and boosting patient trust. Meanwhile, hemp, with its lower THC content, is primarily utilized in wellness and nutraceutical applications, with growing interest in cosmetics and dietary supplements. Though smaller in scale, hemp-based products are gaining consumer traction for their natural profile and health benefits.
The Australian market is also segmented by derivatives into CBD (cannabidiol), THC (tetrahydrocannabinol), and others. CBD products command the largest share due to their non-psychoactive nature and broad application across both medical and consumer wellness categories. From oils and tinctures to capsules and skincare, CBD is widely accepted for its anti-inflammatory, anxiolytic, and analgesic properties.
THC-based formulations, while more tightly regulated, are seeing increased adoption in clinical settings, particularly for palliative care and pain management. The “others” category includes emerging cannabinoids like CBG and CBN, which are currently being explored for niche therapeutic uses, with future potential hinging on continued research and policy development.
The eastern states of Australia New South Wales, Victoria, and Queensland form the largest and most evolved cannabis market in the country. The states are home to most of the licensed producers, prescribing physicians and cannabis pharmacies, and important clinical research hubs such as those in Sydney, Melbourne and Brisbane.
Here patient’s uptake is high, driven by telehealth based prescribing, as well as product portfolio modality availability (flower, oil, capsules, gummies). Victoria, in particular, has emerged as a leader in public policy discussions around adult-use legalization.
Southern Australia involving South Australia and Tasmania is expanding as a manufacturing and export hub, driven by greenhouse-friendly climates and government-backed agriculture initiatives. Then there is the Adelaide biotech corridor, breeding research and development-driven cannabis companies, and Tasmania’s hemp and CBD agriculture initiatives, this also is building out product innovation.
This makes the region increasingly competitive in GMP-certified extraction and processing, catering to both local demand and international exports.
This area (comprising the Northern Territory and northern Queensland) is an emerging cannabis cultivation zone, and its ample land, sunshine, and cool period attract low-cost outdoor grow operations. Despite local patient volumes potentially being low due to limited infrastructure and rural access challenges, First Nations-led, major cultivation opportunities have garnered interest - as have integrated wellness tourism opportunities made possible by the medicinal cannabis sector. Darwin is running pilot programs to start looking at tropical crop resilience and genetic research.
With Perth-based companies investing heavily in high-volume cultivation and extraction infrastructure, Western Australia (WA) is poised to emerge as a strategic player in cannabis exports. WA is also a testbed for CBD-infused cosmetics, pet care and wellness beverages for both domestic and Asia-Pacific markets. The region’s proximity for trade to Southeast Asia and the growing interest by investors in CBD lifestyle branding, particularly in coastal wellness towns like Fremantle and Margaret River, are tips in its favour.
Central Australiacovering sections of outback Queensland, SA, NT, and WA-has minimal direct consumer uptake but is essential to industrial hemp farming and seed trials, as well as rural R&D. Universities and agritech affiliations run pilots for soil, water-use, and cannabinoid-yield optimization in weather-dry localities. Although Central Australia is not a major consumer region, it forms part of Australia’s national cannabis supply chain, particularly large-scale cultivation licenses and research-based cannabinoid breeding programs.
Regulatory Ambiguity, High Entry Barriers, and Prescription Bottlenecks
The Australia legal cannabis market continues to be impacted by regulatory inconsistency across federal, state and territory jurisdictions. Although medicinal cannabis is legal through the Therapeutic Goods Administration (TGA) via the Special Access Scheme (SAS-B), access for patients is significantly impeded due to complicated prescription processes, limited GP training and no products available through pharmacies.
OTC CBD pathway still in limbo with no S3 products approved. High costs for licensing, cultivation, GMP compliance, and product testing create steep hurdles for start-ups and disincentive small-scale domestic innovation.
Domestic Market Expansion, Export Potential, and Health Consumer Demand
Australia’s federally legal cannabis industry is on track for mass-growth despite systematic hurdles, thanks to increasing public acceptance, potential therapeutic use cases, and international export markets. The ant nociceptive and anti-anxiety activity provide a perspective on new therapeutic applications.
With legislative pressure now building for adult-use legalization largely through public activism and political discoursethe stage is being set for a larger recreational market. Australia’s role as a global supplier of pharmaceutical-grade cannabis is further reinforced by the growing exports of GMP-certified medical cannabis to European and Asia-Pacific markets.
For the 2020 to 2024 timeframe, the market targeted SAS-B approvals, with steadily increasing prescriptions for chronic pain and anxiety. But patient uptake was limited by the fragmented prescribing landscape, low prescriber confidence, and lack of public subsidy under the Pharmaceutical Benefits Scheme (PBS).
The shift toward more general market acceptance from 2025 to 2035 will be driven by ongoing debates around adult-use reform, greater pharmacy access and healthy/safe consumption trends that continue to gain traction, especially via low dose, non-potent varieties of cannabis products including CBD oils, edibles, and topical. The next stage will also be defined by export growth, tech-enabled supply chains and biotech innovations.
Market Shifts: A Comparative Analysis 2020 to 2024 vs. 2025 to 2035
| Market Shift | 2020 to 2024 Trends |
|---|---|
| Regulatory Landscape | Complex licensing for cultivation and import; limited OTC CBD availability |
| Technology Innovations | Focus on indoor cultivation, extraction, and GMP compliance |
| Market Adoption | Patient-centric growth through SAS-B pathway, with pain and anxiety dominance |
| Sustainability Trends | Early-stage energy optimization and organic growing trials |
| Market Competition | Led by Cann Group, Little Green Pharma, Althea Group, and AusCann |
| Consumer Trends | Demand for affordable oils, capsules, and dried flower |
| Market Shift | 2025 to 2035 Projections |
|---|---|
| Regulatory Landscape | Likely introduction of adult-use pilot programs, OTC CBD products, and standardized access models |
| Technology Innovations | Emergence of AI-powered strain profiling, smart cultivation ( IoT ), and biotech-based cannabinoid synthesis |
| Market Adoption | Expansion into recreational, wellness, senior health, and sports recovery segments |
| Sustainability Trends | Widespread adoption of solar-powered greenhouses, carbon tracking, and zero-waste product lines |
| Market Competition | Entry of multinational pharma firms, verticalized wellness brands, and craft cannabis cooperatives |
| Consumer Trends | Shift toward low-dose functional products (CBD beverages, gummies) and lifestyle branding |
Driven by its arid climate, vast land availability, and its investment in cannabis agribusiness infrastructure, Western Australia is fast emerging as a leading cultivation and export hub. As licenses for the cultivation, research, and processing of medicinal cannabis continue to expand, companies across Perth and its perimeter are expanding greenhouse space and collaborating for global supply. And the state’s efforts to diversify its agriculture, shift towards biopharma production, and home grow is fuelling local demand for compliant cannabis eco-systems.
| Region | CAGR (2025 to 2035) |
|---|---|
| Western Australia | 30.2% |
Near Brisbane, Queensland is developing into a cannabis research and development and manufacturing powerhouse, largely around therapeutic cannabis, chronic pain and clinical trials. Biotech firms and universities based in Brisbane are working on THC and CBD formulations, while in the Sunshine State's rural areas indoor and outdoor growers are ramping up their operations. State support for agricultural technology parks and pharmaceutical innovation zones is helping speed commercialization of cannabis-based wellness and prescription-grade products.
| State | CAGR (2025 to 2035) |
|---|---|
| Queensland | 30.0% |
New South Wales is pioneering medical cannabis access programs, prescription volumes and pharmacy distribution networks, creating Australia's largest legal cannabis consumer base. Getting The Goods: Sydney and Newcastle is the home base for major players, providing telehealth cannabis consultations, dispensary services, and compliance-grade packaging with the flexible guidelines surrounding patient pathways and regulation set forth by the state government, the rapid adoption seen among chronic illness patients (such as chronic pain and epilepsy) has pushed the demand for cannabis oil, capsule and vaporizer- based products.
| State | CAGR (2025 to 2035) |
|---|---|
| New South Wales | 29.8% |
Victoria became the first Australian state to legalise medicinal cannabis, leading the nation in policy innovation, pharma-grade production and integration into public healthcare. GMP certified cannabis extraction, clinical research and product standardization leading companies are based in Melbourne. Victoria is set to be the long term leader in medical cannabis exports and precision therapeutics with the Government continuing to support the cannabis R&D drive with the Medicinal Cannabis Industry Development Plan.
| State | CAGR (2025 to 2035) |
|---|---|
| Victoria | 30.1% |
Australia’s legal marijuana market is the largest by share, underpinned predominantly by increasing medical usage and an evolving legal structure. Demand for cannabis-derived products has grown steadily in Australia, when the country legalised medicinal cannabis, especially for treating chronic pain, epilepsy, anxiety and the side effects of chemotherapy.
Marijuana, unlike hemp, has higher concentrations of THC and therapeutic compounds, whereas hemp is regulated for its low levels of commodity-grade products or often the residual by-products from pharmaceutical-grade formulations available to consumers under medical prescriptions.
With your leadership of the Therapeutic Goods Administration (TGA) and Office of Drug Control (ODC), we have seen pivotal progress in regulatory processes, improving patient access and clinician confidence. Australia’s expanding collection of licensed cannabis producers and recent clinical trials have continued to validate marijuana’s effectiveness in terms of medical treatments.
Hemp based products also lack the same interest through Special Access Scheme (SAS-B) and Authorised Prescriber pathways, including in states such as Victoria and New South Wales where interest in medical cannabis is high. With increased public knowledge and reduced barriers to access, marijuana is likely to continue as the mainstay of Australia's legal cannabis sector.
Derivatives of the non-psychoactive cannabis compound, CBD (cannabidiol), dominate the Australian legal cannabis market offering greater therapeutic versatility and social/medical acceptability than intoxicating forms of cannabis. The use of CBD to treat anxiety, insomnia, inflammation, and epilepsy have created a large demand among patients looking for alternatives to traditional pharmaceuticals. CBD, unlike THC, doesn’t produce a “high,” which has helped it gain acceptance among mainstream wellness and medical communities.
A pivotal moment of the market was the TGA’s 2021 which facilitated investment and innovation, spurred domestic companies to seek clinical trials and TGA approvals. The lion’s share of medicinal cannabis prescriptions written in Australia are for CBD dominant products, due to its favourable risk profile and great demand across populations. Against this backdrop, CBD remains the dominant derivative in the legal cannabis space, outpacing THC and other cannabinoids by a wide margin in terms of penetration and growth trajectory.
Australia's legal cannabis market is booming, thanks to rising acceptance of medicinal cannabis products, new regulations, and growing consumer demand. Recreational cannabis remains largely illegal, but the sector for medicine has exploded, with more and more prescribers for medicine getting accredited and patients passing through the system.
Market Share Analysis by Key Players
| Company/Organization Name | Estimated Market Share (%) |
|---|---|
| Cann Group Limited | 18-22% |
| Little Green Pharma | 14-18% |
| Althea Group Holdings | 12-16% |
| AusCann Group Holdings | 10-14% |
| ECS Botanics Holdings | 8-12% |
| Others | 26-32% |
| Company/Organization Name | Key Offerings/Activities |
|---|---|
| Cann Group Limited | As one of the pioneers in Australia's legal cannabis industry, Cann Group has established extensive cultivation and production capabilities, positioning itself as a leading supplier of medicinal cannabis products. |
| Little Green Pharma | Little Green Pharma has gained recognition for its high-quality medicinal cannabis products and has expanded its reach into international markets, particularly in Europe, through strategic partnerships. |
| Althea Group Holdings | Althea focuses on patient access and education, providing a comprehensive suite of medicinal cannabis products and support services to healthcare professionals and patients. |
| AusCann Group Holdings | Focuses on developing and commercializing cannabinoid-based medicines, with an emphasis on clinical research. |
| ECS Botanics Holdings | Specializes in the cultivation and manufacture of medicinal cannabis, emphasizing sustainable and organic practices. |
The overall market size for Australia legal cannabis market was USD 81,835.1 million in 2025.
The Australia legal cannabis market is expected to reach USD 1,119,519 million in 2035.
The rising medicinal prescriptions for chronic pain, epilepsy, anxiety, and sleep disorders, alongside growing interest in CBD-based nutraceuticals and wellness offerings will drive the demand for Australia legal cannabis market.
The top 5 states which drives the development of Australia legal cannabis market are Western Australia, Queensland, New South Wales, Victoria, and Tasmania.
Marijuana is expected to grow to command significant share over the assessment period.
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Australia Legal Cannabis Market
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