BOULDER, Colo., April 28, 2020 /PRNewswire/ — BDSA, the leading provider of cannabis industry market research, together with its partner Arcview Market Research, today announced that 2019 legal cannabis sales grew by 46% to $14.7 billion, a significant increase from the 16% growth of 2018 and the industry’s highest annual rate of growth to-date.
Growth in the adult-use cannabis markets of Canada, California and Massachusetts were the largest contributors to global sales growth in 2019, supplemented by the expanding medical markets of Florida and Oklahoma.
“By relaxing product restrictions and adopting more of a free-market approach to licensing, states like Florida are realizing the potential of medical cannabis sales,” said Roy Bingham, Co-Founder and CEO at BDSA. “In addition, light regulation and low tax rates in states like Oklahoma enable citizen access, greater performance over the illicit markets and a healthy tax revenue stream for the state.”
U.S. sales grew 37% year-over-year to reach $12.3 billion in 2019, compared to 2018 U.S. sales of $9 billion. California reported solid 18% sales growth in 2019, compared to weak prior year sales comparisons that included the first months of California’s adult-use sales that began January 2018.
In collaboration with Arcview Market Research, BDSA also announced its initial forecast for 2025 global cannabis sales of $47 billion, representing a compound annual growth rate (CAGR) of 21% from 2019. U.S. legal cannabis sales are projected to represent 72% of total global sales by 2025, down from 84% in 2019. BDSA projects that U.S. legal cannabis sales will approach $34 billion by 2025, increasing at an 18% CAGR.
“The long-term sales growth outlook for the global legal cannabis markets remains exceptional with sustained average revenue growth of 21% projected through 2025,” said Bingham. “The cannabis industry may soon reach a watershed moment when U.S. states, faced with a looming global recession, consider cannabis legalization as a new and potentially lucrative source of tax revenues.”
Other key updates to the global cannabis forecast include:
- Sales in the California and Massachusetts markets anchored 2019 U.S. legal cannabis sales of $12.3 billion.
- Medical programs in U.S. states, including Maryland and Oklahoma, reported higher than expected sales in 2019 and boosted overall U.S. spending growth.
- Ontario, along with other populous Canadian provinces, licensed new retailers to open and addressed supply chain issues, creating a better product flow and significantly improved sales in 2019.
- Canada’s “Cannabis 2.0” policy expanded product offerings beyond flower and oil in mid-December 2019. Though the impact on 2019 sales was limited, sales are projected to accelerate in 2020 as a result of the new product form factors.
- International legal medical cannabis spending – excluding the U.S. and Canada – soared 64% in 2019, from $446 million to $732 million, due mostly to expansion of programs in the German, Australian and Mexican markets.
Note: The long-term sales growth outlook in the forthcoming publication, The State of the Legal Cannabis Markets 8th Edition, is unchanged in the context of the COVID-19 pandemic. Updates to these global forecasts are published semi-annually. The mid-year 2020 update to the 8th Edition, to be published in August, will feature first-half 2020 retail data, improved category-level forecasts and updated forecasts for 2020 and beyond.
Headquartered in Boulder, Colorado, BDSA helps businesses improve revenues, reduce innovation risk, and prioritize market expansion. The company provides a holistic understanding of the cannabis market by generating insights from point-of-sale data, consumer research, and market-wide industry projections. To learn more please visit www.bdsa.com.
About Arcview Market Research:
Since 2011, Arcview Market Research has published over 20 reports analyzing and forecasting the rapidly evolving cannabis space. Arcview’s flagship annual report, The State of Legal Cannabis Markets has become the industry standard for market analysis and data in the sector. In 2017, Arcview Market Research partnered with BDS Analytics to add more robust point-of-sale data and consumer insights to its offerings. Arcview Market Research is a project of The Arcview Group. The Arcview Investor Network includes more than 600 accredited investors who have put more than $235 million behind 200 companies.
Founder & Interim Editor of L.A. Cannabis News