Report: California cannabis market poised for growth

(This story has been updated to reflect Arcview Market Research’s role in the report.)

California’s marijuana market is poised for huge growth after a $500 million drop in legal sales in 2018, according to a wide-ranging report released Thursday.

Key takeaways from the report released by Arcview Market Research and BDS Analytics include:

  • Legal marijuana sales slid to $2.5 billion in 2018 from roughly $3 billion in 2017 amid the transition to a fully regulated legal system and widespread retail contraction.
  • Sales will hit $3.1 billion in 2019 and $7.2 billion in 2024, which will be “40% larger than Canada and 253% larger than the next-largest state (cannabis market), Colorado.”
  • If such growth is realized by 2024, sales could represent as much as one in four of all dollars spent in the U.S. on legal cannabis.
  • There have been “billions (of dollars) in merger and acquisition activity between October 2018 and June 2019.”
  • The central drag on business and sales growth in California has been the “77% tax and regulatory load imposed by the state on the price of legal products.”
  • Lower-priced generic cannabis products are slowly being replaced by “branded product with better pricing power.”
  • Vaporizer cartridge sales are booming, jumping to $75.6 million in May 2019 from $26.8 million in January 2018.
  • Wholesale flower prices, by contrast, have not fared well since January 2018, mostly because of competition from illicit businesses and the inability of customers to distinguish legal flower from illegal.

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One comment on “Report: California cannabis market poised for growth
  1. Pat on

    Damn right it’s poised for growth. All those small time farmers, and people that were preparing to be part of the supply chain as the “law” was being promulgated had a number of years to hone and perfect their skills. And then the law passed in the form that it came in. Effectively pulling the rug out from underneath all of these previously compliant folks. Did they really think that the stupidity and underhandedness of the final version of the law was going to stop the vast majority of them. Hell no. Most are going full steam ahead

    So yes, Ca. cannabis is poised for even more growth. But, not in the manner in which the corrupt elites and their special interest partners wanted it to play out. Like 90%+ of that market underground. Is that a winner for the state? The ca. tax paying citizen? Less than 10% of the cultivated cannabis in the state being regulated? Smart legislation/regulation?

    The only reason why law enforcement will be recruited/utilized if they go after the vast majority of these small players will be based primarily on the elites greed redux program. Not the significant neg effects on the environment; not the publics’ health or public safety concerns. Those were all ruses to make it LOOK like the state and their cronies were doing something noble.

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