The cannabis market is booming these days, now operating legally in a number of states and countries across the globe.
In 2017 Uruguay became the first country to allow adult-use cannabis sales to occur nationwide. By all measures, the rollout was a success.
Several other countries allow cannabis to be bought and sold for medical purposes, generating revenue and helping suffering patients in the process.
North American cannabis sales topped 10 billion dollars in 2017, which was a 33% increase over 2016. As of June 2017, there were an estimated 165k-230k cannabis industry jobs.
With such eye-popping numbers, it begs the question: ‘How big will the cannabis industry get?’
$40 billion in economic impact by 2021
A successful and growing cannabis industry has a butterfly effect on the economies that are involved.
Direct cannabis sales are applicable for many conversations, but the overall economic impact of the industry is also worth discussing.
ArcView Market Research in conjunction with BDS Analytics released a report at the beginning of 2018 which estimated that the overall economic impact of the cannabis industry would increase to $40 billion by 2021.
The report also found the following:
- California’s cannabis industry will create nearly 99,000 industry jobs in the state by 2021
- Sales taxes from the legal cannabis industry will top $2.8 billion by 2021
- California, Colorado, Massachusetts, Nevada, Oregon, and Washington will account for more than 60% of total economic output for the industry in 2021
Many initial projections for the cannabis industry in states that currently allow adult-use sales proved to be too low as time went along.
The next three years could prove the same to be true about these projections.
International growth is helping increase projections
Another study with projections for 2021 was conducted by the Brightfield Group.
That particular study estimated that the international market for cannabis will hit $31.4 billion by 2021.
The 2017 study conducted by Brightfield Group also found the following:
- The industry will experience a compound annual growth rate of 60 percent
- The U.S. currently drives 90% of worldwide cannabis sales but will drop to 57% by 2021
- Canadian companies will largely benefit from international expansion into Europe and South America
Since the United States continues to cling to prohibition at the federal level, it will continue to fall behind other countries that embrace cannabis reform and international exports.
The United States could certainly change its federal cannabis laws between now and 2021, and with every passing year, Canadian companies will further increase their headstart on the international stage.
U.S. cannabis market to surpass $24 billion by 2025
U.S. cannabis companies may not be able to export their products to other countries (or other states for that matter), but the domestic market is still going to be enormous.
A study released in 2017 that was conducted by New Frontier Data estimates that the cannabis industry in the United States will top $24 billion by 2025.
Of the over $24 billion projected, New Frontier Data estimated that over half of the revenue would be generated by the medical cannabis industry but that the year-over-year growth of the industry would increasingly be driven by adult-use sales.
The study projects that Florida, California, and Washington State will be larger cannabis markets than Colorado which was the first state to vote to end cannabis prohibition.
Over a million cannabis jobs projected by 2025
One cannabis industry study that was particularly inspiring, and was also conducted by New Frontier Data, estimated that the cannabis industry would create over a million jobs by 2025.
Every part of America needs more jobs, especially jobs that raise a person’s quality of living such as those found in the cannabis industry.
The same study found that the cannabis industry would add $131.8 billion cumulatively to the US Treasury by 2025.
As with all of the studies found in this article, these are projections made by professional entities, but they are estimates.
It’s quite possible that all of them could prove to be low when all is said and done.
What the current cannabis market projections will largely depend on is how much cannabis reform spreads between now and future years.
