A new report from European market analysis firm Prohibition Partners pulled out a crystal ball, and estimated that the combined Canadian and American legal weed markets will be worth nearly $50 billion in just five short years.
First reported by Health Europa, the North American Cannabis Report predicts that, despite federal legalization up north, America’s state-by-state industry will continue to dwarf the Canadian market into the 2020s. And with both medical and adult-use legalization expanding rapidly across the States, Prohibition Partners’ researchers are confident that the US medical market will not only survive continued recreational expansion, but thrive. In 2024, the authors expect medical marijuana sales will account for more than half of all market value.
Current financial models have a built in skepticism thanks to continued federal prohibition, but as legislators at both the state and federal level continue to fight for cannabis law reform, those legal barriers look more like dominos for market watchers.
“In the US, the model is imperfect. The legal disconnect between federal and state, and between states themselves, presents significant challenges for businesses looking to mature a market with significant potential,” Daragh Anglim, Managing Director at Prohibition Partners, said. “Moreover, conflicting adult-use laws in the US are forcing businesses to move to neighboring states. On a positive note, this is fueling momentum behind legislation as state regulators look to generate and protect tax revenues.”
Of course, Prohibition Partners isn’t the first firm to try their hand at future pot industry predictions, and compared to past reports, every new outlook just keeps looking brighter and brighter. According to Motley Fool, American analyst firm Cowen estimated last year that the global weed market would reach $75 billion by 2030. And a more recent analysis from the Wall Street firm Stifel puts a 2029 global sales prediction at $200 billion.
No matter who you ask, the green rush is slated to grow like, well, a weed in the coming decades. And that’s just the legal side of the market, with Prohibition Partners also expecting even more millions to continue passing hands through the black market.
“Although North America’s legal cannabis industry could be worth more than $47.3 billion within the next five years, the true value of the cannabis market is likely to be much larger than current estimates,” Anglim noted. “This is because, contrary to the hopes of regulators, legalisation is unlikely to eradicate black market sales, particularly in Canada.”