A new report from experts in the cannabis industry has made it official: At a projected $3.1 billion in sales in 2019, California is the biggest marijuana market in the world.
That sales number represents a 23% increase over sales in 2018, the first year of legal recreational marijuana in California. And it’s not slowing. Sales are projected to increase to $7.2 billion by 2024.
Those numbers call come from a new report by Arcview Market Research and BDS Analytics. The researchers, who specialize in the marijuana market, called the report: “California: Lessons From the World’s Largest Cannabis Market.”
After a rocky start to sales in 2018, companies in the Golden State “are battle-hardened, and kicked off a merger and acquisition flurry in the first half of 2019 that will allow them to leverage their positions in California to compete across the country,” Arcview Group CEO Troy Dayton said in a statement.
Good News For Consumers
The explosive growth in the California market has been a boon for consumers, who now have an unprecedented variety of legal marijuana products on the market. It’s also been a job creator for the California economy.
The report expects that to continue in the coming years, especially if leaders in the United States legalize marijuana at the federal level. At that point things will really begin to escalate for California, Tom Adams, Managing Director and Principal Analyst for BDS Analytics’ Industry Intelligence group and Editor-in-Chief for Arcview Market Research, said in the statement.
“At that point, California will assume its usual place in the world economy as a major exporter of agricultural commodities and their derivative products, a technology mecca, and consumer product trendsetter,” he said.
The Report’s Findings
Adult-use marijuana sales were disappointing in the first year, with less tax revenue for the state than expected. It’s led to a black market that remains strong in the state, according to the Los Angeles Times.
The new report put the blame for that on a regulatory environment in California that makes it expensive to produce marijuana products. However, as one of the report authors noted to the Times, a 23% increase is something every market in the world would be “ecstatic” about.
The report also offered a quick profile of who is using marijuana products in California. According to the report, the average marijuana consumer in California is 44 years old.
There is a split on cannabis use among the generations. The report found that 39% of Gen Z and Millennials and 41% of Gen X reported cannabis consumption in the past half-year. But with Baby Boomers, that number was only 20%.
There’s room for growth, as well. Many cities and counties have decided not to allow marijuana sales. That means the state has a relatively small number of retailers for its population, with one licensed retailer for every 35,147 adults over the age of 21. In contrast, Colorado has one for every 4,240 adults.