In a report released earlier this week, the Colorado-based data crunchers at BDSA noted they expect the global cannabis industry’s annual sales to jump from $30 billion in 2021 to $57 billion in 2026.
BDSA also said that the projected rise in sales would represent a compound annual growth rate of almost 13%.
BDSA expects the bulk of the sales to remain in the U.S. through its 2026 projection. The report estimates U.S. sales will rise to $42 billion over the time period, representing 75% of sales in the global marketplace. The $2 billion jump from 2021 to 2022 represented a 7% increase in sales despite financial unrest in America with inflation.
Most of the domestic growth will be a result of state markets coming online. Just look at places like New York and Florida. People are very excited to be getting their hands on decent cannabis, period. Once the market’s transition from grey to regulated is complete, the numbers will pile up.
And while much of the time we’re thinking about these chunks of billions state by state, it’s also a bit closer to home. Within the California market, there still are giant swaths of legal sales waiting to come online. The state’s underground market was still thought to be worth $8 billion in 2021.
If half of that $8 billion is sales being lost in California at this moment, you’re talking about a big impact on that national average. It’s not. Maybe a quarter is. A lot of that $8 billion number at this point is interstate commerce, and that $8 billion number we saw getting thrown around in late 2021 doesn’t account for continuing price drops.
Roy Bingham, BDSA’s CEO, thinks the regulatory infancy of cannabis is now behind it.
“The ‘hockey stick’ trend of sales growth seen in the early years of legal cannabis has passed, and economic and regulatory headwinds are exerting pressure on legal cannabis markets,” said Roy Bingham, CEO of BDSA. “Still, our updated forecast predicts that steady gains in developing U.S. markets will continue to drive single-digit annual growth in total U.S. legal sales in 2022, with continued growth prospects out to 2026.”
BDSA expects to continue to see a lot of cheap weed everywhere. The older the marketplace, the firmer this reality. The report noted chronic oversupply issues in Washington and Oregon forcing the governments there to take action. California is in a similar boat, but regulators are yet to take action.
“Though mature legal cannabis markets in the U.S. saw sales soften in 2022, the cannabis market is still forecast to see topline growth in 2022, driven by strong sales in new and emerging markets, such as the populous states of New Jersey and New York,” Bingham said. “The U.S. will continue to dominate global sales over the next few years, but we see potential from emerging global markets such as Germany and Mexico.”
The data from BDSA also further reinforces the Department of Cannabis Control’s stance on the wild claims from the San Bernardino County Sheriff that about 80% of the marijuana on legal shelves is cultivated illegally. The state said those claims were unfounded, and the data shows it would be downright dumb, given the flooded marketplace with its $200 pounds.
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