The legal marijuana market is exploding - it'll hit almost $10 billion sales in this year
- Legal marijuana sales are predicted to hit $9.7 billion in 2017, a 33% increase over 2016, according to a new report.
- The growth is buoyed by new states legalizing marijuana, and sales exceeding expectations in existing markets.
- Analysts predict the market to hit $24.5 billion in sales by 2021, despite continued federal prohibition.
The market for legal marijuana is heating up in a big way.
Legal marijuana sales are predicted to hit $9.7 billion in North America in 2017, according to a new report from cannabis industry analysts Arcview Market Research, in partnership with BDS Analytics.
That represents an unprecedented 33% increase over 2016, shattering previous expectations about how quickly the cannabis industry could grow in the face of federal prohibition. The report further predicts the entire legal cannabis market to reach $24.5 billion in sales - a 28% annual growth rate by 2021 - as more states legalize marijuana for recreational use and existing markets mature.
"Aside from cryptocurrency, there is simply no other industry changing as rapidly or as unevenly as the cannabis sector," Troy Dayton, Arcview's CEO said.
The industry's growth is buoyed by a number of new state-legal markets coming online in 2017. Nevada, where legal marijuana sales began in July, raked in $27 million during the first month of sales, according to the report, prompting a supply shortage that forced Gov. Brian Sandoval to issue a "statement of emergency" to bring more marijuana into the state.
Revenue for the first six months of 2017 in Colorado, Washington, and Oregon - the first three states to legalize marijuana for adult-use - ran 33% ahead of 2016, also indicating that the market is still growing, according to the report.
California is set to begin sales of recreational marijuana on January 1, adding a massive consumer base to the industry. And Canada is set to begin nation-wide sales on July 1, 2018.
"Our data shows positive indicators across the board for the legal cannabis industry, in North America and around the globe," said Tom Adams, Arcview's editor-in-chief. "That's nothing compared to what we can expect in 2018 and beyond from Nevada's tourism, and California and Canada planning to launch adult-use sales in 2018."
The report notes that the projection hinges on the assumption that the federal government does not crack down on state-legal cannabis, nor does it assume that there will be a host of new states legalizing marijuana in the next few years.
Attorney General Jeff Sessions is a noted opponent of marijuana legalization, though the Justice Department has not yet indicated that it would seek to prosecute state-legal marijuana businesses.
Recreational marijuana is legal in seven states, and some form of medicinal marijuana is legal in thirty states. Marijuana is still considered an illegal Schedule 1 drug by the federal government, however.
A Gallup poll released in October indicates 64% of Americans support legalizing marijuana for both recreational and medicinal use, the highest support since Gallup first asked the question in 1969.