A new analysis of the cannabis industry estimates that marijuana sales in the U.S. will reach $75 billion by 2030.
America’s marijuana market could soon eclipse that of soda beverages. According to new projections from market research firm Cowen & Co., the United States legal cannabis industry will reach $75 billion in sales by 2030. That’s in striking distance of the North American soda beverage market, currently valued at $76 billion.
Cowen and Co. had previously predicted the market would reach $50 billion by 2026, with the caveat that cannabis became federally legal. Now, even with recreational marijuana only legal in nine states, and medical marijuana legal in 29, that estimation appears too low.
“New forecasts suggest that the market is already that size,” said Cowen and Co. analyst Vivien Azer, in a note to Bloomberg.
The market estimates offered by Cowen & Co. are notably higher than those provided by other research firms. BDS Analytics recently put the U.S. cannabis industry at $9 billion, and estimated that the market would hit $11 billion before year’s end before surging to $21 billion in 2021. Last year, Marijuana Business Daily in its annual Factbook estimated the current market to be $6.1 billion in 2017 and that it would reach $17 billion by 2021.
While the nation’s marijuana market is clearly on the rise, soda sales in the U.S. are on the decline as consumers seek more health-conscious alternatives to sugary beverages. According to data from Euromonitor International, the soda market in North America dropped from $78.3 billion in 2016 to $76.4 billion last year. Trade publication Beverage Digest reports that per capita carbonated soft drink consumption in 2016 dropped to a 31-year low. The trends indicate that the cannabis market will soon eclipse the soft drinks industry.
Provided marijuana does eventually become legal under federal law, the estimated $75 billion in sales by the nation’s cannabis industry would generate $17.5 billion in tax revenue by 2030, according to the note by Cowen & Co.
Growing U.S. Marijuana Industry
The nation’s cannabis market is expected to continue growing over the next decade and a half, due to the further expansion of legalization and a greater social acceptance of marijuana.
Marijuana remains illegal federally, but there are currently nearly 30 states that have legalized marijuana in some capacity, while North Dakota and Maine are getting closer to launching their legal markets. Efforts to expand marijuana legalization are underway in New Jersey, Oklahoma, and Michigan, and legislation to legalize marijuana under federal law was introduced late last this year.
Attitudes around cannabis have shifted significantly over recent years, and polls indicate that support for legalizing marijuana nationwide is now at an all-time high.
The booming cannabis market does still face numerous challenges. Attorney General Jeff Sessions is a noted opponent of increasing legal access to marijuana. Earlier this year, he rescinded Obama-era protections that limited interference into state-legal cannabis businesses by federal prosecutors. Officials from states with legal marijuana are currently seeking a meeting with Sessions in an effort to resolve conflicting state and federal marijuana laws.