US Current Market
Cannabis is the world’s most widely grown, trafficked, and consumed substance, and as the movement to legalize it increases, investors, producers, and academics are taking notice. Officially classified as a Schedule I substance, Cannabis generated $13.6 billion in revenue in 2019 and supported 340,000 employment, according to New Frontier Data, despite being a federally prohibited substance.
In 2020, more than two-thirds of adults think Cannabis should be legalized. The public’s support for legalizing soft drugs has risen dramatically in recent decades. In 2003, barely a third of Americans supported legalization, while over 60% opposed it.
Now, the substance is already legal in 35 states, with 16 of those states permitting recreational usage by adults. Cannabis is still classified as a Schedule 1 substance by the federal government, which means it remains illegal in the US.
Source: Investopedia
Policy Reform
Because Democrats now control the House, Senate, and the White House, marijuana policy reform activists expect federal legislation to change soon. According to Politico, 296 members of Congress (68%) represent the 33 states that have legalized medicinal marijuana, providing enough votes to approve long-awaited legislation. The next Congress already has many marijuana-related measures.
Cannabis companies raised $116.8 billion in 2019, according to Viridian Capital Advisors. This trend will likely continue.
According to Joe Biden, Cannabis should be legalized, and criminal records of people who have been convicted for possession should be wiped. The Marijuana Justice Act, sponsored by Senator Cory Booker, would legalize marijuana, and Vice President Kamala Harris was a co-sponsor of the legislation. A road to decriminalization and legalization has been proposed by Harris, who supports expunging marijuana convictions.
CBD
People all across the world have depended on Cannabis to treat a wide range of illnesses since the dawn of creation. The Marihuana Tax Act, which banned it in the US, was enacted in 1937. In the modern-day US, individuals with chronic pain or seizures increasingly see the plant as a viable treatment alternative.
Thanks to cannabidiol (CBD), a non-psychoactive natural chemical present in cannabis plants. No one gets high from it. Cannabis-derived cannabidiol (CBD) is offered as an oil, oral spray, cream, pill, or gummies and lollipops. CBD proponents believe it may relieve pain, reduce anxiety, and boost happiness. It may even cure cancer patients.
Market research firm New Frontier Data projects a 3.3x increase in the market for hemp-derived CBD from $390 million in 2018 to $1.3 billion in 2022. The hemp CBD industry might reach $22 billion by 2022. There will always be restrictions and hurdles, but Brightfield’s managing director Bethany Gomez says this company has too much speed, need, and promise not to explode.
Growth of Cannabis in the US
According to New Frontier Data, 141 million US people (43%) live in 18 adult-use states, “providing a diversified and geographically spread customer base for merchants to segment and target.” By 2025, legal sales in regulated markets are expected to meet 42% of the total annual US cannabis demand. This is a 24% increase from 2020. Consumer demand is expected to rise due to increased legal market spending and the conversion of current illegal market expenditure to legal, controlled sources, according to New Frontier Data.
Also, by 2025, 5.4 million US people, or 2.4 percent of adults, will be registered medicinal cannabis patients.
Investor confidence has risen as more states legalize and use Cannabis. The report estimated that by May 2021, legal cannabis financing had increased to $6 billion.
Legal recreational cannabis sales in the US for 2019 to 2026
Licensed recreational cannabis sales in the US are predicted to reach an estimated $42 billion by 2026. In the next years, legal cannabis sales are expected to grow at an increasing rate.
By 2025, the US is estimated to have close to 50 million cannabis users. Further, Legal and illegal cannabis sales in California accounted for more than half of all US totals in 2018. Recreational cannabis sales in California reached $5.5 billion in 2018, thanks to the state’s legalization. As a result, this was more than double the size of New York’s marketplace. It is predicted that California’s recreational marijuana industry will reach 7.2 billion dollars by the year 2024.
Source: Statista 2021
The black market is still thriving, and it will continue to do so. The illegal national cannabis demand and consumption were anticipated to be worth more than $65 billion in the year 2020 when the epidemic was declared.
Despite this, Kacey Morrisey, senior director of industry analytics for New Frontier Data, said that the cannabis market, which includes all consumer expenditure on Cannabis, is increasing tremendously, whether or not it is legal. The increasing number of legal jurisdictions, however, will not be enough to stop the illegal market’s growth.
