California is more likely to set a record $3.1 billion in licensed marijuana sales this year. This will help it strengthen its position as the largest legal cannabis market in the world—according to a study by financial analysts in the industry.
Cannabis’ popularity among patients with different conditions is on the rise. More people are opting for the herb over prescription medications, and applying for medical marijuana cards Fresno.
Arcview Market Research and BDS Analytics have found that legal cannabis sales are up significantly from $2.5 billion in 2018. Tom Adams, managing director & principal analyst for BDS Analytics, said, “Any market in the world would be ecstatic about a 23% growth rate. That is fabulous for any industry to have that kind of growth.”
Legal Cannabis Sales in California
California legalized medical cannabis in 1996, and became the first US state to do so. And, after 20 years, it passed the Adult Use of Marijuana Act, allowing licensed retailers to start selling cannabis products for adults in January 2018.
Allowing legal sales helps increase the size of the market. It applies to the states where cannabis is legal. But, in California, legal sales were $3 billion in 2017 and were reduced in the next year. The state’s marijuana market has been adversely affected by the legalization of recreational cannabis.
While states such as Oregon, Washington, etc. have experienced positive effects with adult-use legalization. But, California experienced the inverse effect. Local bans have also been contributing factors, causing retailers to shut their businesses.
Additionally, the black market that continues to grow has also put a great impact on legal cannabis sales in California. High taxes and restrictions in most cities are automatically allowing consumers to turn to the black market over licensed shops.
As per an estimate, in 2019, $8.7 billion is expected to be spent in the illegal cannabis sales. It’s more than double the legal cannabis sales.
Dale Gieringer, director of Cal NORML, said, “The illegal market is competitive because legal marijuana is so expensive to produce under Prop. 64.”
Tom Adams said, “California companies that survived the dual ‘extinction events of 2018 have emerged stronger and well-positioned to grow their market share going forward. More than that, they’re battle-hardened, and kicked off a merger and acquisition flurry in the first half of 2019 that will allow them to leverage their position in California to compete across the county.”
The analysis also projected that the legal market is expected to grow to $7.2 billion by 2024 while the illegal market dropping to $6.4 billion.
With medical researches showing cannabis as a safe treatment for various conditions, states are putting efforts to make the herb easily accessible for patients. The latest analysis says that California is on track to become the world’s biggest legal cannabis market with $3.1 billion.
Local bans and black market are affecting the legal marijuana market. But, experts believe that the legal cannabis sales are expected to grow $7.2 billion by 2024.
Talk to a licensed doctor to get legal access to medical marijuana in Fresno today!