AN UNEXPECTED OPPORTUNITY IN SOUTH KOREA
South Korea, in recent years, has been marked by the cultural phenomenon they’ve ushered in over the last few years, with South Korean K-Pop entertainers conquering their way across East Asia and now the world, with one hit song and hit drama at a time. There has also been another unexpected, but meteoric rise, and that is of CBD, one of the many non-psychoactive compounds found in the cannabis plant. South Korean CBD has found its way into the cosmetics industry and is here to stay.
Investment bank Jeffries have estimated that this corner of the global beauty industry will be worth up to 15% of the entire market, and valued at $25 billion in the next ten years. It is assumed that most of this growth will be driven by the health & wellness industry as CBD has gained the reputation of being a clean, organic and natural product. Victoria Buchanan, a senior futures analyst from the strategic research firm, The Future Laboratory has noted that ‘CBD as a search term is now four times higher than THC’. This helps to remove the undeserved stigma from the plant, from being a dangerous hallucinogen to an organic, natural product that does the job without artificial chemicals or components.
MEETING THE ETHICAL NEEDS OF THE MODERN CONSUMER
According to the retail analytics Edited, the global beauty industry will balloon to a massive $532 billion in this year and cite sustainability as one of the four biggest drivers of growth in this industry. The report states ‘Sustainability is becoming increasingly important to transparency-minded customers who want to know where our products come from and how they are made.’ This has always influenced the growth of the cannabis industry, which has traditionally always concerned itself with the quality of product and carefully positioned itself as an honest cottage industry. Now with significant scale, the image remains with careful branding from companies like Cannuka, ran by a farmer and dermatology professional or Milk Makeup’s clean looking product offering.
INCREASING EFFICIENCY WITHOUT DAMAGING THE ENVIRONMENT
The sustainability of the product comes from its growing process, which typically utilises less water than most crops and provides a bigger harvest for a smaller plot of land. Joseph Nunez, founder of EcoGen Laboratories noted that ‘The plant needs roughly 25 to 30 inches of rainwater to thrive. We collect rainwater within our reservoirs and use drip irrigation. Hemp is essentially zero-waste and we utilize all aspects of the plant.’ This is an important aspect of CBD’s image, which is a sustainable ingredient in cosmetics as well providing the benefits it claims to. It has skipped the cost-heavy and mistake laden process of researching environmentally friendly supply chains, product packaging and operating procedures. We know how important this is, since we saw the global reaction to the water needed to produce many nut milks, so many consumers switched to the more sustainable oat milk, and may even see favourites like the avocado relegated to the status of an unsustainable, troubling piece of natural produce that requires extreme amounts of water as well as attracting armed violence in certain parts of Central and South America. The only sustainability issue facing CBD production at the moment is producing strains of hemp with high concentrations of CBD and lower concentrations of THC. Though the leaps and bounds taken by cannabis growers while the plant was illegal suggest that with legality, research could drive forward at rapid rates and find answers to sustainability based questions in a shorter time than other industries.
With the beauty industry only growing, there are certain regions in the world that do more to contribute to the direction it is heading in than others. Right now, that is undoubtedly K-Beauty (Korean Beauty) and J-Beauty (Japanese Beauty) with their respective aesthetic styles becoming more and more popular worldwide. With the mass proliferation of K-Pop (Korean pop music) and K-Drama (Korean drama television) across Asia, these beauty standards will eventually become the norm across Asia. Unlike western beauty industries, K/J-Beauty differentiate themselves with a focus on traditionalism and older, time-tested approaches to beauty. 18th century Joseon court records show that upper-class women of the time had the same tastes and routines as modern Korean women – with a focus on skincare as opposed to makeup. As CBD cosmetics become a bigger part of the most influential beauty standards on the planet, there is no doubt that the rest of the world will want to copy it and try South Korean CBD cosmetics for themselves.
EVERYBODY WANTS A PIECE OF THE SOUTH KOREAN CBD PIE
Western companies are now recognising the need to move into South Korea’s cosmetics industry and capture the opportunity – before others do. The CEO of Folium Biosciences Kashif Shan said, ‘South Korea is truly a cosmeceutical innovator thanks to its preventative approach to skin care and product development. Our ground-breaking CBD-infused cellulose face mask launch last season signalled an immediate need for our team of scientists and doctors to develop a range of market-ready CBD-infused topical products.’ It is essential for a cosmetics company to establish and trade in a market where the beauty industry grows with an annual rate of 4.7% across the last five years as well as a huge 18.3% growth in exports from 2018. While hemp production hasn’t sky-rocketed in South Korea, Asia will not go without producing lots of CBD rich hemp, especially for the affluent South Korean CBD market.
CHINA EMBRACED HEMP/CANNABIS IN THE PAST AND WILL DO SO AGAIN
China, the world’s largest producer of hemp have maintained international standards with low THC content, but also were zealous with CBD. With new research and less hostility, certain regions of China have been opened up to foreign companies to cultivate hectares of CBD-rich hemp. China has a rich history with cannabis. It was the first place in the world where records of cannabis use are mentioned, and was used as a medicinal herb in ancient China. This, coupled with the fact that China is now opening itself up to cannabis production is only lending to the certainty investors are feeling around China’s legal status on cannabis. Only recently on the 24th September, Canadian cannabis growers Pure Global Cannabis announced plans to grow hemp in China to produce a variety of products, including CBD. The firm had signed an agreement with the Chinese government to grow seventeen thousand hectares of the crop in the Yunnan province. Most importantly, the firm said that the produce will be exported across Asia to markets in which CBD products are legal, one of which will most certainly be South Korea.
FORMERLY HOSTILE GOVERNMENTS ARE DEMONSTRATING A SHIFT IN ATTITUDE
The Asian cannabis scene can be at times, confusing. While China is strict with its own citizens use of the plant, it has a different stance towards the product being produced and exported from their country. Singapore, maintains some of the strictest penalties and laws against any type of drug use. Yet it is home to the global headquarters of CannAcubed, a global cannabis firm who are also setting up a huge centre in China alongside their hectares of CBD rich hemp. The openness demonstrated by China in regards to the production of the plant is paralleled by their zeal for cannabis. China is in ownership of over half of the six hundred cannabis related patents worldwide, this reflects the importance and esteem in which it is held in, in China. If the government open up the domestic market for CBD consumption, the South Korean CBD cosmetic craze will take a hold in Chinese cities, where K-Pop and K-Drama have gained a considerable foothold to become a massive market. South Korean CBD cosmetics were given a great start to life, it was born in a time where attitudes to cannabis are changing globally, and was born in the country that has now begun to define beauty for the whole world.
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