US Cannabis market to outpace growth of Smartphones
December 9th, 2013
Categories : Blog
The legal cannabis market is currently growing at an unprecedented rate in the US, to the point where it looks like it could overtake the global expansion smartphones.
Within recent years, cannabis has become legal for medical use across the US. The industry is gaining so much momentum that it is poised to start outpacing the growth of the global smartphone market.
Researchers have spent the last 6 months surveying members of the industry, from end users and outlets to producers. From their findings it is estimated that $1.43 billion worth of legal weed will have been sold by the end of 2013. It is also estimated that 2014 will see $2.34 billion in sales – a growth of 64 percent.
When you compare it to the smartphone market, one of the biggest in the world which „only“ expanded by 46 percent, you get an idea of the rate at which legal cannabis use is growing on an industrial level.
The use of medical marijuana is currently legal in 20 states, and the states of Washington and Colorado have voted to legalise its recreational which will allow any adult to be able to buy it in the close future. This spread of marijuana acceptance is the cause of this rapid growth in the industry, and more states will soon be voting whether they want to follow suit. It is estimated that the recreational legalisation of weed will generate $359 million in Colorado alone next year.
The way things are going, the spread of marijuana acceptance will only increase. The city of Portland, Maine has just voted to legalise the recreational use of marijuana within its city limits, and for the first time in history, more than 50 percent of American citizens believe that marijuana should be legalised for both medical and recreational use. This has been brought on for a number of reason, the main of which is science. There is an ever growing stream of scientific research proving both the medicinal value as well as the safety of using cannabis. This has led to mainstream media attention, such as from CNN who aired a documentary aimed at informing the everyday American the medical benefits of weed.
Steve Berg, the editor of this report, (the second edition of the State of Legal Marijuana Markets) said, “There has been a seismic shift in public attitudes towards marijuana (…) younger voters will become a bigger proportion of the overall voting base. It begins with shifts in attitudes and that translates to initiatives." These shifts in opinion will eventually lead to new law.
The future prosperity of a cannabis-based economy
Berg’s report estimates that 14 more states will follow suite, legalising the use of marijuana within the next 5 years. This would take to total to 34 out of 50 and generate an estimated $10.2 billion extra in revenue. Berg describes how investors and businessmen smell the winds of change and are flocking to put their money in this budding industry - and by the looks of things, they are set to make a lot of money.
What is more astounding about this news, is that Berg and the team of researchers have only focused on the sale of marijuana itself. They did not take into account the sales of paraphernalia, security requirements, apps, growing equipment, auxiliary products and other industries that could spring up to help facilitate it. As the marijuana market expands, and as it becomes legalised, these markets will also grow, spurring on even more economic development – and just think about the taxes the government would be set to make!
The only thing that offers a real obstacle to the market is that cannabis is still technically illegal at a federal level, meaning that although certain states have voted for legalisation, the central government and the DEA still view marijuana as a controlled substance.
The way things are looking, the federal government may be moving towards a gradual acceptance. There have been recent raids of dispensaries in Colorado, but Attorney General, Eric Holder, recently outlined how the Justice Department was not going to challenge the recent legalisation in Washington and Colorado; and the opinion of the public will hopefully instigate further change. As mentioned by Berg, it is very unlikely that we will see the federal government change its opinion with one decisive action. It will be a long, but important step by step process. The opinion of the United Nations would also have to be changed, as state legalisation currently operates within a loophole as long as marijuana remains illegal at a national level. And as little as some would like to admit it, America holds a lot of influence on the world stage – so it may not be long before we see other countries assess whether marijuana should really be illegal.