The global attitude toward cannabis is rapidly shifting. With the current wave of medical and recreational legalization, there are now 70 countries that have some form of legalization. As a result, the cannabis industry is entering a new chapter as billions of dollars in investment dollars pour in.
Since the legalization movement gained traction in just a few short years, societal attitudes toward cannabis have shifted dramatically. Dispensaries, for example, were deemed essential businesses during the pandemic. Malta is the first country in Europe to legalize recreational cannabis use, while online retailers such as Zamnesia.com meet growing consumer demand for cannabis seeds throughout Europe. This shifting dynamic is one of the reasons why the global cannabis industry now generates more than $20 billion in legal recreational sales each year.
The United States has the world’s largest cannabis market, with more than $16 billion in sales expected in 2020. However, although over 30 states have legalized cannabis in some form, their regulatory landscape is one of the most difficult to navigate. While this unique situation can eliminate potential revenue, it also provides a potential upside for the industry if legalization trends continue. For example, Mississippi, Oklahoma, and Delaware are expected to legalize cannabis in 2022, reducing the number of states without legal cannabis from 14 to 11.
A robust supply chain of growers, retailers, support systems, and biotechnology companies supports this multibillion-dollar market. Each will become more important as the industry grows. In addition, consumer spending surpassed $20 billion in 2020 and is expected to reach $37 billion by 2023.
Trends to Watch
Cannabis has had a slow start in comparison to other industries. After a nearly 90-year-long prohibition, innovation has been relatively dormant for decades. However, many new cannabis products and technologies are now on the market.
For example, there were an average of 19 new products in California dispensary shops every day. The traditional method of consumption remains flower. However, non-combustible forms, such as edibles and vape products, have gained traction recently, with vape sales expected to increase by 30% by 2022. Furthermore, CBD products are rapidly gaining popularity, particularly among women, who account for 60% of CBD sales. Thousands of new products and technologies will be introduced in the coming years, implying that product preferences may continue to evolve.
Cannabis Has a Bright Future
The cannabis industry’s momentum has piqued the interest of investors worldwide. As a result, the average size of cannabis equity capital raises increased 165 percent from $7.5 million in 2020 to $19.1 million in 2021. Momentum is also visible in cannabis stock indexes, showing signs of recovery. But where does marijuana go from here? Things are moving quickly, and the global cannabis market will be worth $103 billion by 2024. Europe and North America will account for the majority of this market, with $39.1 billion and $37.9 billion, respectively. However, other regions are expected to post impressive results as well. With a market value of more than $100 billion, the cannabis industry has the potential to outperform online betting and gaming.