New Forecast: U.S. MMJ and Recreational Cannabis Sales to Hit $8 Billion by 2018
By Anne Holland
U.S. retail cannabis sales will rise more than five-fold over the next five years, from an estimated $2.2-$2.6 billion in 2014 to $7.4-8.2 billion in 2018, according to new financial data released today in the 2014 edition of the Marijuana Business Factbook.
Although the 2014 estimated sales are right in line with predictions from last year’s edition of the Factbook, the 2018 forecast has risen by roughly $2 billion. This lift is largely due to the impact of last August’s Cole Memorandum wherein the federal Department of Justice stated it would take a hands-off approach to the cannabis industry as long as companies obey local laws and state regulations and oversight are strict.
“You could call it the $2 billion memo,” remarked Chris Walsh, editor at CannaBusiness Media. (Note: CannaBusiness Media is the publisher of both the Marijuana Business Factbook and Marijuana Business Daily.)
“This total is conservative – the reality of retail sales could be larger,” Walsh continued. “Nor does it include wholesale cannabis sales, or the billions of dollars in ancillary cannabusiness revenues such as growing equipment, real estate, legal fees, testing labs, paraphernalia, etc.”
The sales estimates include both medical marijuana and recreational cannabis sales, and account for additional states establishing and launching cannabis sales programs during the time span covered by the forecast. These predictions assume 4-5 new recreational states and 2-3 medical cannabis states will have fully-functional programs by 2018.
Recreational cannabis sales are only legal in two states currently. According to estimates, 2018 is anticipated to be the first year that recreational sales match or even overtake MMJ sales in the U.S.
This data does not include black market sales. However, other research indicates that despite prior industry fears, the majority of cannabis consumers are willing to switch from black market providers when cannabis is legally available in their regions.
The U.S. black market is currently estimated to be in the $40 billion range. Thus, the legal marketplace has significant potential beyond 2018.
Very few MMJ states release data on cannabis sales (or even track it.) Only a tiny slice of cannabusinesses release their financials for public scrutiny. The editors of the Marijuana Business Factbook 2014 used a wide variety of methodologies to create the sales forecasts. Sources include exclusive surveys of both cannabis consumers and cannabusiness executives, as well as statistics and political analysis reported in Marijuana Business Daily and its sister publication, CannaBusiness Magazine.
Dispensaries and retail cannabis stores in Colorado sold nearly 150,000 pounds of marijuana flower last [click to continue...]
Recreational marijuana has dominated headlines out of Washington DC this week, as the use, possession [click to continue...]
A company that got turned down for one of the Illinois’ 21 medical marijuana cultivation [click to continue...]
A financial services firm that plans to serve the cannabis industry has secured $2 million [click to continue...]
Alaska marijuana entrepreneurs who want to specialize in infused products or extracts will have to [click to continue...]
With private marijuana use on track to become legal in Washington DC on Thursday barring [click to continue...]
Oregon is facing an interesting question tied to its medical marijuana law: Should evicted cannabis [click to continue...]
Institutional investors will put money into cannabis stocks this year, though many publicly traded MJ [click to continue...]
Alaska Gov. Bill Walker has sent a bill to state lawmakers calling for the establishment [click to continue...]
Canadian stock regulators have a word of warning for those investing in MMJ companies north [click to continue...]
At least half of Minnesota’s medical marijuana dispensaries will be unionized. The United Food and [click to continue...]
Dispensary owners in New York may have a niche customer base to tap when they [click to continue...]
A U.S. investment fund has cemented its second deal with a Canadian cannabis grower this [click to continue...]
Dispensary owners in San Jose, California, are in a dispute with the city over unpaid [click to continue...]