If you still harbor any doubts that cannabis is a major economic force in the United States, here’s a stat to ponder: In 2019, sales of adult-use and medical cannabis topped the annual revenue of the NBA.
While cannabis’s complicated legal status complicates the job of tabulating total sales, it’s estimated that last year, sales of legal cannabis totaled between $10.6 and $13 billion. Compare that with the National Basketball Association (NBA), which earned $8.8 billion in the same year. The NBA, it should be noted, is hardly in decline; compared with the year before, the league earned a healthy $750 million more in 2019.
But cannabis is in a league all its own. While the global COVID-19 pandemic has thrown a wrench in several of 2020’s planned legalization pushes, there are no indications that the Green Wave is subsiding any time soon. Both Arizona and New Jersey are preparing to vote on adult-use cannabis come November. If both measures pass, that will bring the number of fully legal cannabis states to 13.
What’s more, projections for cannabis’s growth are equally rosy. Even in states where adult-use cannabis cuts into medical sales, revenues are on the rise. By 2024, it’s estimated that cannabis sales could reach between $30.2 and $37 billion. Even at the low end, that’s more than the current market for craft beer ($29.6 billion) and potentially twice as much as prescription pain medications ($16.1 billion).
Of course, the growth of the legal cannabis industry hasn’t been without its speed bumps. In California, the world’s largest legal cannabis market, the rollout of adult-use cannabis in January 2018 was awkward at best. Beset both by a patchwork of local restrictions and a stubborn illicit trade powered in part by high taxes, state officials and market-watchers have repeatedly downgraded the state’s earnings projections. To this day, local ordinances make cannabis sales illegal in a third of the state.
Disappointing though this may be to Californians, the overall cannabis sales figures indicate that—the Golden State’s middling revenues aside—cannabis will only continue to grow in value in the coming years.
In Florida and Oklahoma, sales of medical cannabis are expected to surpass $1 billion each by 2021. Michigan and Illinois continue to see strong adult-use sales, the latter powered at least in part, we hope, by the state’s forward-thinking stance on social equity in the cannabis industry.
As we hinted before, the COVID-19 pandemic is throwing the best-laid plans into disarray. Thankfully, the designation of dispensaries as essential service providers was a major victory both for operators and those who rely on cannabis to help manage their self-care. But as the experience indicates, the winds can change in an instant, especially in this politically uncertain environment. Stay tuned for more updates on the cannabis industry, the impact of the COVID-19 pandemic and any other item of cannabis-related news we think you should know.