Despite Being Illegal Under Federal Law, Cannabis Has Grown Into a $9 Billion Industry In States Where It Is Legal.
Americans are spending as much on legal marijuana as they do on car parts, yogurt or Halloween candy.
The marijuana market grew to $9 billion in 2017, and that was before California began legal recreational marijuana sales and Florida did the same for medical marijuana this year.
Needless to say, projections for 2018 are quite a bit higher, according to Tom Adams, an analyst with BDS Analytics, a Colorado-based company that tracks the marijuana industry. Adams told CNN that the company estimates the marijuana industry raked in about $9 billion in sales in 2017. BDS expects that number to hit $11 billion this year and $21 billion in 2021.
BDS gets its information from point-of-sale information from dispensaries. The company has analyzed more than 300 million sales so far. For some context, the marijuana sales numbers are about the same (or more) than annual sales in the United States for:
- Car parts
- Nutritional shakes and bars
- Halloween candy sales
So, big. Not Apple, Wal-Mart and Exxon big, but not bad for a product that remains illegal under federal law.
California and Florida
More than 12 percent of the total U.S. population lives in California. It’s $2.4 trillion annual gross domestic product ranks sixth in the world when compared against entire nations. It’s easily the largest market for marijuana, and recreational sales just started a month ago.
Estimates vary on how big it could get. The number typically falls between $5 billion to $6 billion a year initially, reaching as high as $11 billion in some estimates. And that’s just the first year.
For many, Florida brings to mind retired seniors who want their supply of medical marijuana in the face of chronic illnesses, aches and pains.
That’s likely true enough, but pro-marijuana millennials also are discovering Florida. The Sunshine State ranks among the Top 5 for growth of young population in the U.S. it also is No. 2 for net migration - a lot more people are moving in than moving out.
Overall, the state has boomed in population. At almost 21 million people, Florida now is the third most populous state, behind only California and Texas. It surpassed New York this decade.
That change in demographics could bring about legalization of adult-use marijuana in Florida in the near future. Even with medical marijuana sales only, the market is expected to reach around $1 billion by 2020.
This year will also see a full year of sales in Nevada, where sales numbers have already outstripped what was seen in Colorado when marijuana became legal. Sales reached $124 million in just the first four months.
In addition, Massachusetts also is set to begin recreational marijuana sales this year. However, the exact start date has been pushed back to July 1 and may now get pushed back even farther.