Global Cannabis Market to Hit $42.7 Billion By 2024, According To Updated Report From Arcview Group, BDS Analytics

COLORADO: Legal cannabis sales grew 45.7% to $14.9 billion in 2019, led primarily by adult-use markets in Canada, California and Massachusetts, and supplemented by the unique approach to medical markets in Florida and Oklahoma, according to the “2020 Update to The State of Legal Cannabis Markets” (SOLCM) report released today from Arcview Market Research (“Arcview Group”) and BDS Analytics.

This worldwide growth estimate is on par with the forecast in the original SOLCM, released in June 2019, and reflects the highest annual growth rate to date. This new data is in stark contrast with the mere 17% growth seen in 2018, due in large part to the shrinkage in California following the launch of adult-use sales on January 1, 2018. As a result of expected growth in key adult-use markets in the U.S. and Canada, Arcview Group has updated their 2024 forecast to $42.7 billion in worldwide legal cannabis sales.

“The legal cannabis market grew by 46% in 2019 despite challenges caused by overregulation and overtaxing in the two biggest markets; California and Canada,” said Troy Dayton, Founder and Chief Strategy Officer of The Arcview Group. “That is a true testament to just how popular cannabis is among consumers and the ongoing impact of new markets coming online and maturing. The possibilities are boundless as political progress opens up more markets across the world, and struggling markets sort out their regulatory framework.”

“By loosening product restrictions and adopting a more free-market approach to licensing, Florida, for example, has started to realize the potential of medical cannabis sales in a populous state,” said Tom Adams, managing director and principal analyst at BDS Analytics. “However, what we’re seeing in Oklahoma is a light regulatory touch and low tax rates, which allows citizens to access the health benefits of cannabis, out-perform the illicit market, and create a healthy tax revenue stream directly to the state’s government.”

Other key trends analyzed in the 2020 Update to The State of Legal Cannabis Markets include:

  • Bustling activity in states such as Illinois, Maryland, and Oklahoma helped boost overall spending growth nationwide, which came out to $12.2 billion across the United States and an anticipated compound annual growth rate (CAGR) of 22.7%.
  • New licensed retailer openings in Ontario and other populous provinces have smoothed out supply chain kinks, creating a better product flow and ultimately improved sales in 2019. “Cannabis 2.0” also expanded product offerings beyond flower and oil in mid-December 2019, with limited impact on sales in 2019, but projected sales acceleration in 2020.
  • Legal medical cannabis spending beyond the U.S. and Canada more than doubled in 2019, from $367 million to $840 million, driven by Germany and Mexico’s markets.

The 55-plus page report is available free to all buyers of the $497 The State of Legal Cannabis Markets, 7th Edition, or as part of the Cannabis Intelligence Briefing Series subscription service from Arcview Market Research and BDS Analytics for $1,975.

Global Cannabis Sales Grow 48% To $15 Billion In 2019

COLORADO: Global cannabis sales rose 48% to $15 billion in 2019, driven by growth in sales in Canada and seven U.S. states that saw sales more than double.

Continued consumer adoption in maturing markets such as Colorado and new adult-use markets including Massachusetts contributed to 45% growth in adult-use sales to $8.9 billion. However, medical-only states and countries actually grew faster – up 54% growth to $6.2 billion. The United States saw 81% of spending in 2019, although superior growth in the rest of the world will continue balancing the market across the US, Canada, and Europe through 2024.

“These stunning growth numbers prove the negative stigma of cannabis is coming to an end in the US. What’s incredible is the realization that so much potential growth remains both domestically and globally,” said Troy Dayton, Founder and Chief Strategy Officer of The Arcview Group. “With sales jumping nearly 50% in an industry with only a handful of markets online, this report quantifies why there’s so much anticipation from producers and shrewd investors waiting for national and international markets to open up or mature. The fallout in public market valuations is not trending with the tremendous growth curve of this exploding market. That discrepancy represents a unique and time-bound opportunity for investors.”

Despite strong growth, regulatory challenges created headwinds that artificially hampered business activity in California, Canada, and numerous other markets.

“The disconnect between investor sentiment and the facts on the ground is as dramatic as anything I’ve seen since the dot.com stock crash of 2000, which happened just as the internet caught fire with consumers,” said Tom Adams, Editor-in-Chief of Arcview Market Research and Managing Director of BDS Analytics Industry Intelligence. “Five billion additional dollars were spent on legal cannabis in 2019. That’s bigger than the entire legal cannabis market was in 2015.”

Among the key points in the forecasts:

  • Sales in 2020 are forecast to increase by 38% driven by growth in established markets and continued geographic expansion, including Illinois’ recreational market opening;
  • Despite medical spending outgrowing adult-use spending in 2019, adult-use markets will be the primary drivers of global market growth through 2024;
  • More than $400 million in Massachusetts adult use sales in the first year of an adult use East Coast market;
  • Florida continues to perform strongly with over $650 million in sales despite being a medical-only market;
  • New consumers continue to enter the market at a rapid pace with the development of new products and social acceptance

For more information, please visit www.arcviewgroup.com and www.bdsanalytics.com

CBD And Legal Cannabis Market On The Rise

NEW YORK: A recent report by Arcview Market Research indicates that consumer spending on legal cannabis in North America is outpacing previous estimates. The report projects that retail cannabis sales will grow 33% from 2016, to about $10 billion this year. The data published projects that by 2021 the legal cannabis market will reach a value of $24.5 billion and at a 28% compound annual growth rate (CAGR).

A Major segment of the legal cannabis industry is the hemp-derived cannabidiol (CBD) market. According to a report by Forbes, Brightfield Group estimates that CBD sales have already hit $170 million in 2016 and at a 55% compound annual growth rate over the next five years the market will cross the billion-dollar mark.

In a report by Forbes, Director of Research at Brightfield Group, Bethany Gomez, explained, “One of the most surprising things we found during this research was how many companies are currently operating in the space, and how few of them are generating significant revenue. Essentially everyone is trying to do hemp, but only a handful is doing it well. It’s seen as easy because it can be sold online but, with restrictions on traditional marketing, it is very difficult to connect with your core consumer and even communicate why they need your product.”

Revenue Growth In The Legal Cannabis Market

NEW YORK: A research published by Arcview Market Research indicates that people in North America spent $53.3 billion on legal, medical, and illicit cannabis in 2016.

The North American legal cannabis market posted $6.7 billion in revenue in 2016, or up 30% from the year before. The illicit market generated 87% of total pot sales, down from 90% in 2015. The data reveals that the illicit market is slowly losing steam as legalization campaigns continue to gain momentum across the country.

The legal market is expected to widen its reach and the research forecasts that growth will accelerate in the beginning of 2018 as adult-use sales ramp up in CanadaCalifornia, and Massachusetts along with medical sales in Florida. The market is expected to grow at 27% CAGR to $22.6 billion in 2021.

Troy Dayton, CEO of Arcview Market Research said in a statement, “The enormous amount of existing, if illicit, consumer spending sets cannabis apart from most other major consumer-market investment opportunities throughout history, the cannabis industry doesn’t need to create demand for a new product or innovation – it just needs to move demand for an already widely-popular product into legal channels.”

 

Developments In The Legal Cannabis Industry

NEW YORK: A report published by The Hemp Business Journal estimates that the Cannabidiol (CBD) market will grow to a $2.1 billion market in consumer sales by 2020 with $450 million of those sales coming from hemp-based sources. In 2015, the market for consumer sales of hemp-derived CBD products was $90 million, plus another $112 million in marijuana-derived CBD products which were sold through dispensaries – bringing a total CBD market to $202 million last year.

In the meanwhile, states that have legalized cannabis are benefiting from taxes. For example, during the 2014-15 fiscal year Colorado took in $70 million, nearly twice as much revenue than the state earned from alcohol taxes, Forbes reported. Colorado is expected to generate $135 million in cannabis taxes and licenses fees in fiscal year 2015-16, according to ArcView research.