Cannabis & CBD Retail Market To Reach $33 Billion In 2024

MARYLAND:  U.S. retail sales of cannabis and CBD products reached $14 billion in 2019, and are on pace to increase 18% per year to $33 billion in 2024, according to data published in Cannabis and CBD: U.S. Retail Market Trends and Opportunities, the latest report by leading market research firm Packaged Facts.

Cannabis products can be segmented by delivery format—i.e., the method by which the product’s desired compounds are ingested:

  • The most common delivery format, flower—smoked in the form of buds or pre-rolled cigarettes—accounts for nearly 40% of retail sales.
  • Another smokable product, vaporizer cartridges with concentrated THC or CBD compounds, comprises the second largest share. However, this share is falling as concerns about vaping-related lung illnesses rise and as states increasingly restrict sales of both nicotine- and cannabis-infused vaping products.

The fastest annual gains are projected for those delivery formats—namely edibles and topicals—that stand to benefit the most from federal legalization of hemp-based CBD. Major retailers—including foodservice establishments in certain states—are increasingly offering CBD-infused food, beverages, cosmetics, and toiletries that appeal to consumers because these products have the therapeutic benefits of CBD without the psychological effects of THC.

Other major delivery formats include tinctures, pills and capsules, and ingestible oils, which are used for both marijuana- and hemp-based products. Ingestible oils made from hemp seed oil (which does not include CBD or THC) have been available for decades and are used by health-conscious consumers for their purported nutritional benefits.

For more information on this emerging market purchase the report from our website.

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

Industries Booming Since Marijuana Legalization

The marijuana industry has been growing steadily since its legalization in the United States, with more than 75% increase in sales, and contributing greatly to the economy of this nation. To date 11 states have legalized marijuana for recreational use and other 33 have authorized cannabis for medicinal use.

Legalization has seen the creation of a diverse range of companies related to the production and distribution of marijuana, driving the creation of hundreds of thousands of new jobs. Some of the industries that have directly benefited the most from marijuana legalization include farms that grow the plant, to the dispensaries that sell its many product forms, as well as various distribution channels, including delivery services.

Below are some of the popular industries that have developed since marijuana was legalized.

Farms

Before marijuana legalization, farmers used to practice secret-indoor farming which consumed much energy. This is now changing since they can freely grow the plant outdoors and utilize the power of the sun. Farming legally has enabled this industry to take advantage of traditional farming practices such as irrigation and multi-farming. Legalization has enabled farmers to practice quality control, including the use of organic fertilizers and eco-friendly growing methodologies.  These innovations improve productivity and improve the marketplace, reducing demand for marijuana black markets.

Dispensaries

Following the legalization of marijuana in some states, dispensaries selling cannabis have mushroomed nationwide. As earlier mentioned, many people have secured employment in these dispensaries including young people, thus reducing the crime rate in towns due to joblessness.

Legal dispensary owners have had to advance their marketing strategies to compete in this legal market. This means that if you desire to venture in this business, you will need more than the investment capital and the proper licenses, you will be required to create a compelling retail experience, and a differentiated brand.  Dispensaries need to stock their shelves with the right products for their local customers and offer the best customer service.

Delivery Services

Dozens of new cannabis delivery services have sprouted all over the country, thanks to legalization. Initial cannabis laws featured restrictions concerning the sale, use, marketing of marijuana, and licensees could not freely make deliveries to their clients.

In recent years, however, several legal states have amended their regulations to allow for home delivery, and this has helped improve customer satisfaction as well as retention.

Manufacturing Industry

The manufacturing industry has been a huge beneficiary of cannabis legalization. Marijuana is no longer just a smokeable product. Cannabis, once its active ingredients are extracted or distilled,  can be infused into a wide range of products — ranging from beauty lotions and potions, wellness and nutraceuticals, food and beverages, sweets and savories.

Wrap Up

The legalization of marijuana for both medical and recreational use has transformed a once cottage industry into big business. Investors are rushing into the cannabis markets, along with entrepreneurs intoxicated with the endless opportunities the Green Rush has presented. Cannabis legalization is driving the growth of a number of ancillary and adjacent industries, and industry analysts expect its current growth to continue to expand for decades to come.

 

U.S. Federal Cannabis Legalization Could Be Worth $128.8 Billion In Taxes And 1.6 Million Jobs

DISTRICT OF COLUMBIA: New Frontier Data, the authority in data, analytics and business intelligence for the global cannabis industry, releases its new study Cannabis In the U.S. Economy: Jobs, Growth and Tax Revenue, 2019 Edition. The report looks at the current state of legal cannabis jobs and tax revenues and projects the impact that full federal legalization would have on the U.S. economy, especially tax revenue generation and job creation. New Frontier Data forecasts that under full federal legalization the cannabis industry could produce nearly $130 billion in additional tax revenues and over 1 million jobs nationwide.

“With so much speculation about economic slowdown, the potential for federally legal cannabis to create up to a million new jobs and close to $130 billion in tax revenue is likely going to be of interest to regulators and presidential candidates in 2020,” said New Frontier Data Founder and CEO Giadha Aguirre de Carcer. “Cannabis is already being considered as an investment option for forward-looking portfolio and fund managers as a possible hedge against economic downturn impacting more traditional investments.”

Some of the report findings include that:

  • 2018-2019 YOY job growth in the cannabis industry generated nearly 82,000 jobs.
  • If full legalization occurred in all 50 states today, there would be in excess of 1.46 million jobs, increasing to 1.63 million jobs by 2025.
  • Full legalization would result in more legal businesses participating in the market, more consumers participating in the legal market, and more employees on official payrolls, resulting in $8.4 billion in payroll taxes. By 2025, payroll deductions would increase to $9.5 billion.
  • Assuming a 15% federal sales tax, total revenues from 2018–2025 would reach $73.7 billion. This amount would be entirely new revenue to the U.S. Treasury, as there are currently no federal sales or excise taxes.
  • The total combined taxes under full federal legalization would reach $175.8 billion between 2018–2025 based on business tax revenues, the payroll withholdings based on the estimated employment, and the 15% retail sales taxes.
  • The difference between the current structure and the theoretical model is a $128.8 billion increase in federal tax revenues.

A free Download of Cannabis In the U.S. Economy: Jobs, Growth and Tax Revenue, 2019 Edition is available at: https://newfrontierdata.com/jobs2019

Washington State Year One Canopy Report Available Online

WASHINGTON:  The Washington State Liquor and Cannabis Board Year One Canopy Report is now available on the LCB website.

The Year One Canopy Report was completed to reflect the results of a canopy survey. The canopy survey was developed at the request of LCB board members in the fall of 2017. The Canopy Project focused on the collection of relevant data from all producers, with an analysis of licensed space utilization.

LCB Canopy Report

During the first year, the Canopy Team attempted to survey 1,155 licensees. The team completed 792 surveys, encountered 254 licensees that reported no canopy, and was unable to survey 109 licensees. The 792 completed surveys consisted of 778 staff surveys and 14 drone surveys. The data indicates that, on average, both indoor and outdoor canopy space is underutilized. The team did encounter licensees producing above their allotted licensed canopy space, however those observations were a small percentage of all observations.

Detailed results and interpretation are available in this report.

Report: Retail Cannabis Tax Revenues Surpass $1 Billion In 2018

DISTRICT OF COLUMBIA: State and local excise tax collections on retail adult-use cannabis sales surpassed $1 billion in 2018 — a 57 percent increase over 2017 levels, according to data compiled by the Institute on Taxation and Economic Policy.

Annual excise tax revenues on adult-use cannabis sales ($1.04 billion) rivaled those for all forms of alcohol $(1.16 billion), the group reported. State-specific sales taxes on retail cannabis purchases also yielded an addition $300 million in revenue in 2018.

Authors of the report estimated that cannabis-specific taxes would raise an estimated $11.9 billion annually if the product were legally available at retailers nationwide.


For more information, contact Justin Strekal, NORML Political Director, at: (202) 483-5500. Full text of the report is available online.

OLCC Provides Oregon Legislature With Recreational Marijuana Supply And Demand Study

OREGON: Today the Oregon Liquor Control Commission provided the Oregon Legislative Assembly with the 2019 Recreational Marijuana Supply and Demand Legislative Report required by ORS 475B.548.
2019 Recreational Marijuana Supply and Demand Legislative Report
A Letter from OLCC Director Steve Marks

Oregon’s Public Policy Approach to Support Legal Marijuana Production and the State’s Abundant Supply: The Course for Seeking the Right Balance

The Oregon Liquor Control Commission is grateful for the opportunity to produce for the Oregon Legislature a comprehensive examination of the amount of marijuana accounted for and contained within Oregon’s regulated recreational marijuana market.
Let me first acknowledge that we have a considerable supply of marijuana in our state’s recreational marijuana system.  That licensed Oregon cannabis growers have become successful in producing this volume of marijuana is due in no short order to the intentional choices made by Oregon voters and policy makers.  Now we find ourselves at a crossroads where our state’s history with marijuana and the future of cannabis commercialization meet.

Oregon’s unique geography and climate are qualities that have enabled generations of Oregon farmers to produce copious amounts of cannabis. The illegal export of Oregon cannabis has been taking place for decades. For Oregon, producing a lot of marijuana is not new news; producing a lot of marijuana that is tracked in the legal system is.

Recognition that cannabis is woven into the state’s cultural fabric initially emerged as institutional tolerance when Oregon became the first state in the country to decriminalize marijuana possession in 1973. Greater acceptance of cannabis occurred in 1998 when Oregon, following California’s lead two years earlier, established a medical marijuana program. A broader embrace of cannabis took place when Oregon voters approved Measure 91 in November,2014, and became the 3rd state to legalize recreational marijuana.

With the debate around legalization largely settled, Oregon’s elected officials began making annual adjustments during legislative sessions beginning in 2015.  Each legislative modification to Oregon’s regulated cannabis system has attempted to improve the industry’s economic stability by removing barriers to entering the market while at the same time enhancing regulatory compliance to address public safety concerns while withstanding federal scrutiny.

Oregon is not creating a new industry, it is converting an illegal cannabis production economy, and a loosely-regulated medical program, into a well-regulated legal market

Oregon oversupply is a sign that policy choices made to attract illegal and grey market producers into the new commercial system have been successful; this was a start-up challenge Colorado and Washington didn’t have to face. Oregon medical marijuana growers had long been suspected of diverting into the illegal market so it was important to attract these well-established producers into the OLCC’s new regulated recreational marijuana program.

To entice medical as well as formerly illegal growers into Oregon’s legal market the state lowered the barriers to entry with low license fees and taxes and chose not to limit the number of licenses. This approach fulfilled the immediate objective to absorb medical marijuana providers into the OLCC market, but it has led to industry churn as businesses face mounting cost pressures and attempt to position themselves for the long term.

The ongoing objective is to account for and contain legally produced cannabis within Oregon, create consumer confidence in the legal market, and establish compliance performance boundaries for marijuana licensees.

By requiring the tracking of marijuana flower and marijuana products, CTS has provided the most reliable accounting for legally produced cannabis in Oregon. For the first time, the state’s production of marijuana is accounted for and there are consequences – criminal and administrative – for licensees that divert product from the regulated system.

Oregon’s legal market has created a new growth industry with quality product, a diversity of choices, and transparent information for consumers

Oregon’s successful transition to a regulated adult-use market has provided customers an unprecedented degree of consumer safety confidence. Oregon’s testing program and packaging and labeling requirements are considered best-in-class and are being replicated by other states that have legalized adult use cannabis. This confidence has contributed to consistent growth in retail activity as evidenced by the $198 million in state and local sales tax revenue generated since legalization.

On the demand side the establishment of a legitimate market has resulted in consumers shifting their purchase activity away from the illegal market to licensed retailers. The conversion of most OMMP dispensaries to OLCC retailers, coupled with the OLCC’s deliberate effort to allow medical grade products for sale at retail, has established a statewide retail network, in which medical marijuana patients are also able to obtain tax-free products.

Industry innovation has continued since the OLCC’s establishment of and oversight over the marijuana supply chain in January 2017; today consumers are able to find a selection of products reflecting a marketplace with 2,100 licensees. As more consumer choices have been introduced and prices have decreased, sales have seen a corresponding increase.

A context for change

Oregon’s current supply in the legal market is a reflection of successful policies to move production into the legal system. The adoption of the legal system by recreational consumers and medical patients for the purchase of branded and tested cannabis products is a strong indication that the legal system is winning the battle against the illegal market.

At the same time, Oregon regulators and law enforcement, with support of the licensed industry, are developing and utilizing new resources and tools to confront illegal market activity. Now that the legal system has successfully taken hold, policy makers can make adjustments combined with market forces to work towards a sustainable economic balance between supply and demand.

The economic condition of the market that the OLCC will be regulating in the next two years remains uncertain. Just as it took time to establish legal alcohol markets after the repeal of alcohol prohibition, the development of the legal marijuana industry will require patience. In less than three years Oregon has made substantial progress toward creating a controlled, economically viable and well-regulated cannabis industry. While regulations to control and manage this new industry will continue to change, no matter the future course, the ability to support existing and aspiring licensees and take enforcement against those that don’t follow the rules will be a crucial function for the state and the private sector businesses that have entered this industry.

A primary objective of establishing Oregon’s regulated market was to contain cannabis legally produced in Oregon from diversion into the illegal market.  Oregon’s legal cannabis market and its framework for accountability and containment indicates the system is performing as it was designed.

At this point we have another opportunity to make intentional choices.  With market mechanisms and thoughtful public policy, the state of Oregon and the OLCC can continue to control what we’ve created – to reinforce and strengthen the regulatory system we’ve built in just three short years.  One corrective policy tool proposed by the Governor would allow the OLCC to place a moratorium on licenses.  As the 2019 legislative session progresses other ideas may emerge.

We expect any guidance that the Governor and Legislature may develop during the 2019 legislative session will strengthen the continued implementation of a regulated marijuana system that balances public safety concerns with the vision of Oregon voters.

The 2019 Recreational Marijuana Supply and Demand Legislative Report is more than just about numbers. Its substance and specific methodology reflect a state-of-the-art approach for evaluating use and demand and normalizing values and equivalencies of differing cannabis products as produced and sold in the Oregon marketplace. While not infallible, this study provides a sound base for the discussion and debate of policy development. The OLCC appreciates the work and time its talented staff and outside peer reviewers have spent to bring forward this public data on legal marijuana production in Oregon.

A copy of the 2019 Recreational Marijuana Supply and Demand Legislative Report can be found on the OLCC on the Recreational Marijuana main page under the Government Resources column.

 

New Report: Legal Cannabis Market Projected To Grow 27% CAGR By 2023

IRELAND: The legal cannabis market is projected to register a CAGR of over 27% by 2023, according to “Global Legal Cannabis Market 2019-2023” a new report just added to ResearchAndMarkets.com.

The latest trend gaining momentum in the market is the use of advanced techniques in cannabis cultivation. According to the report, one of the major drivers for this market is the rapid legalization of cannabis. Further, the report states that one of the major factors hindering the growth of this market is the health hazards associated with the consumption of cannabis products.

Market Trends

  • Increasing demand due to growing number of patients who need cannabis for medical use
  • Use of advanced techniques in cannabis cultivation
  • Rising mergers and acquisitions in the cannabis sector

Key Players

  • Aphria
  • Aurora Cannabis
  • Canopy Growth Corporation
  • CV Sciences
  • Tilray

New Report Details Growth Of Global Cannabis Market to 2023

IRELAND: ResearchAndMarkets.com has released the “Cannabis Market by Product Type (Flower, Concentrates), Compound (THC-Dominant, CBD-Dominant, and Balanced THC & CBD), Application (Medical and Recreational), and Region (North America, South America, Europe, and Row) – Global Forecast to 2023” report.

Among the highlights:

Growing medicinal application of cannabis is expected to drive the overall growth of the cannabis market

  • The cannabis market size is expected to grow from USD 10.3 billion in 2018 to USD 39.4 billion by 2023, at a Compound Annual Growth Rate (CAGR) of 30.7% during the forecast period.
  • The cannabis market is driven by various factors such as the growing medicinal application of cannabis and the increasing legalization of cannabis. However, a complex regulatory structure for the use of cannabis can hinder the growth of the market.
  • The concentrates segment is the fastest-growing segment in the cannabis market, by product type. This is due to their ease in usage and their versatility in the method of delivery, such as dabbing, ingestible oils, and tinctures. Also, along with ingestion, concentrates can offer cleaner, smoother, and less-odiferous hits than flowers. Concentrates are being increasingly opted for over flowers, as these as more potent in nature. The potency of concentrates could also be modified as per requirement and usage, to evoke a higher consumer likeability.
  • The THC-dominant segment is projected to hold the largest share and grow at the highest CAGR during the forecast period. The dominance of this segment is majorly attributed to the fact that THC is the psychoactive substance in cannabis products and is responsible for head high feeling. Even though high THC content is better known for its mind-altering euphoria, it has important medical benefits and is considered effective in relieving nausea, appetite loss, and insomnia.
  • The market in this region is primarily driven by the growth in the US and Canadian markets. The market in this region is driven by the increasing legalization of cannabis for both medical and recreational purposes all over North America and the increasing awareness among consumers regarding the health benefits of cannabis.