America’s love affair with cannabis
COVID-19 disrupted the growth of certain industries in the United States of America. However, the country’s cannabis industry owes all of its growth to the pandemic.
Recently it was reported that total cannabis sales in the country totaled $ 17.5 billion.
This is an unprecedented record in global marijuana sales.
What is more surprising is that the industry was able to achieve this revenue as its main component. Cannabis is still considered illegal by the country’s federal government.
Marijuana is the most traded and consumed drug in the world. It is commonly grown on small, medium, and large scales in several regions of the world. The US is one of those regions.
For more than two decades, cannabis legalization has been actively pursued in the country. There are so many reasons.
Some of these include;
Medical research reasons
Reasons for recreation
Everyone has a reason to want to legalize this drug.
No progress has yet been made at the federal level. The federal government actively classifies cannabis as a List 1 drug.
Much progress has been made at the state level in most states. Some have legalized the use of cannabis for medical reasons only, while some have legalized the drugs for recreational and medical reasons. Of the fifty states, 35 states have legally advocated the sale of cannabis in one way or another.
These states are responsible for total sales of $ 17.5 billion. Without them there would be no legal industry for the cannabis market.
Given the recent successes in the cannabis industry, we can categorically state that the legalization of cannabis at the federal level is no longer a matter of “if” but of “when”.
It has to be sooner rather than later because the black market makes at least $ 100 billion annually from the cannabis industry.
The first legal sale of cannabis in the US started in California in 2018. Total revenue in 2018 was $ 1.4 billion and in 2019 it was $ 2.8 billion. That number rose to $ 4.4 billion in 2020. This makes the state the largest cannabis economy in the United States.
Other states have joined in, and now we can see cannabis sales up 46% from 2019 to today.
The growth in sales may be related to the increased rate of recreational use of the drug.
The state of Illinois had the highest dollar profit last year. This is because adult marijuana use was finally legalized in 2020. Revenue increased $ 784 million, exceeding the $ 1 billion mark in total revenue.
Colorado is another large cannabis market that has total sales of $ 2 billion from its medicinal and recreational cannabis industries.
Oregon hit the $ 1 billion mark in 2020. At the height of the pandemic in May, the state had sales of at least $ 100 million for four months in a row. The recreational and medicinal cannabis markets had impressive sales in 2020.
Maryland had total sales of over $ 1 billion in its medicinal-only cannabis market.
Washington had total sales of $ 1.4 billion in 2020. This is not surprising as it has the second oldest leisure market in the country.
Massachusetts grew 56% from 2019 and had sales of nearly $ 700 million in 2020. It will undoubtedly cross the $ 1 billion mark this year.
Nevada is well on its way to totaling $ 1 billion in recreational and medicinal cannabis sales this year.
Most of this data was obtained from a cannabis sales data platform, BDSA.
Experts around the world also agreed that the boost in sales was due to the most obvious factor that made 2020 unique. the coronavirus pandemic and statewide lockdowns in different parts of the country.
Kelly Nielsen, who is in charge of the analytics department at BDSA, stated that given the massive sales in 2020, the cannabis industry can be described as recession-proof. The industry remained unaffected despite the economic downturn.
Mr Nielsen also pointed out that in addition to the pandemic, more states were found to be legalizing adult cannabis use. As more customers looked at the mature cannabis market in Colorado, California, and Oregon. Existing customers also increased the amount of cannabis they consumed. Demand increased from all sides.
BDSA found that the total number of cannabis users in the recreational market alone was six times higher than at the end of 2019.
In Colorado, approximately 48% of the total number of the Coloradan population take up adult cannabis use. The number increases from year to year.
Andrew Livingston, director of economics at VS Strategies, agreed with the above, adding that most consumers would have to increase their normal order as there were no other conventional ways to relax. Recall, cinemas, restaurants and concerts were banned because of the pandemic.
One niche in the cannabis industry that has also won the most is the delivery service niche. They made record profits during the pandemic. Their customer base increased by about 25% (as reported by BDSA).
Andrea Brooks, founder and CEO of Sava cannabis delivery platform, said the high-end company saw sales growth of 60% at the start of the pandemic. The increase did not let up until the end of the year. She also mentioned that it seemed like more consumers were finally leaving the black market and entering the legal cannabis industry.
Sava is now on a customer loyalty course and is increasingly striving to expand the company’s range of services.
Over time, concrete action will be taken to remove marijuana from the list of drugs on List 1. This will disperse most of the black market cannabis industry in the country.
The US marijuana market was only able to move forward from then on. This growth was predicted to continue through 2021. At this rate, the legal cannabis market will surpass total sales of $ 41 billion before 2026.
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