What can you expect from cannabis in 2020? Here are five trends making a splash in the new decade.
As the world moves into the 2020s, cannabis is moving right along with it. The cannabis market is becoming more and more normalized in the global economy and American culture.
Cannabis industry trends evolve faster than most markets. Although it’s clear there are many changes ahead, this week we take a look at the top five trends for the cannabis industry to keep an eye on for 2020. The trends span the full industry, touching on projections for marijuana, hemp, and CBD.
1. CBD Market Maturation
More than ever before, people are talking about cannabidiol (CBD). The non-intoxicating cannabis-derived compound that naturally promotes balance and wellness through its interaction with the body’s endocannabinoid system is becoming a house-hold name and is currently being used by nearly seven percent of Americans.
While public interest in CBD is soaring, so are sales. Hemp Industry Daily projects that retail hemp-derived CBD sales will continue to increase, from $1.2 billion in 2019 to $10.3 billion by 2024, representing a five-year compound annual growth rate of 54 percent.
As the hemp-CBD market matures, all thanks to the initial wide-spread hemp legalization in the 2018 Farm Bill, more and more pressure will be placed on the federal government to establish regulations on CBD products.
Until those federal regulations are in place, CBD will continue to cross over into all sorts of areas from food and drinks to soaps and nasal sprays. Expect to see CBD on the menu at your favorite bars and restaurants.
Learn more about the basics of CBD.
2. Growth in Cannabis Jobs
Despite still being an illegal substance under federal law, marijuana is quickly becoming one of the fastest-growing industries in the U.S. With that kind of growth, it’s only logical that a huge need for cannabis workers would follow.
Full-time legal cannabis jobs in the U.S. have skyrocketed in the last several years to around 340,000 in 2019. That number could reach 1 million by 2025 if cannabis became legal in all 50 states, according to New Frontier Data.
Marijuana Business Daily’s 2019 Marijuana Factbook predicts that the number of jobs for people working in the cannabis industry will reach between 385,000 and 475,000 by 2023. Expect to see more cannabis listings pop up on your Indeed profile.
Find out which cannabis jobs provide the best pay.
3. Cannabis Company Consolidations
Like any other new venture, investing in cannabis has been a move that comes with risk. With the challenges of finding banking organizations willing to work with cannabis-related businesses and other legal hurdles, smaller legal cannabis companies are being bought out by the bigger fish.
A lack of access to banking due to federal laws has led to small companies struggling to expand. One reason that can be linked to the rise of consolidation, according to a report from the Green Fund, is the necessity of vertical integration.
Currently, legal U.S. marijuana companies that want to branch out to other states need to establish growing, processing and selling infrastructure in each new location, because each state has its own unique set of laws. This makes it easier for companies with more reach and deeper pockets to swallow up the competition.
Green Fund suggests the consolidation process will take place in three easy to spot stages. The first is already happening, with the smaller boutique or craft cannabis producers being bought up by Canadian Licensed Producers and some of the multi-state operators (MSO) in the U.S.
The second stage will be evident when larger Licensed Producers and MSO’s start to acquire each other. The third stage will happen on the big day when the U.S. federal government legalizes marijuana. Guess we will just have to wait and see.
As the new decade gets underway, expect more and more small cannabis company consolidation and get ready to see big names step in to take their place.
4. Marijuana Legalization Expands
Illinois kicked off the new year by becoming the eleventh state in the U.S. to legalize recreational marijuana. It’s shaping up to be a big year for cannabis reform with approximately 20 states moving towards some form of cannabis legalization and regulation by means of legislative bills and voter referendums, while ten states have cannabis decriminalization bills in the works.
According to Marijuana Moment, as of January, there were nearly 1,000 cannabis-related bills moving through state legislatures and Congress for 2020 sessions. Take a look at our list of states to watch in 2020.
To date, 47 states and the District of Columbia have legalized marijuana in one form or another, and 6 in 10 Americans back full marijuana legalization. Learn what states already have legal access to medical or recreational cannabis by visiting our Where Is Marijuana Legal? page.
5. Hemp Makes Its Return
Hemp has a rich history in the U.S. and throughout the world. After the signing of the 2018 Farm Bill, “hemp for victory” is gradually making a comeback. Hemp is the hero we need right now with its diversity and sustainability powers.
Reports show that hemp’s versatility will lead to a reboot of the U.S. manufacturing sector as companies incorporate hemp for its countless applications and products. There are literally thousands of ways hemp can be used in mainstream America including food, clothes, building materials, and paper materials. It could even replace plastic someday.
Now federal agencies are not only allowing hemp production but offering insurance and pilot programs to boost production. Hemp was even written into the new U.S./China trade agreement requiring China to import American-grown hemp.
U.S. hemp production has more than quadrupled in the last year. According to the United States Department of Agriculture, the amount of acreage used to farm hemp leaped by 368 percent in 2019.
If that isn’t reason enough to get excited, hemp may even help to save bees. Studies have linked hemp production in some areas to growth potential in bee populations. But wait, there’s more. Hemp-derived CBD products can be used for a multitude of health benefits by positively affecting the endocannabinoid system. Reports show that hemp-derived CBD products are on track to reach $22 billion by 2022.
Expect hemp to become an essential element in the fabric of American culture.
Cannabis Industry Analysis and News
Join us as we follow the developments of cannabis business, policy, and scientific research into the new decade. Check out our cannabis news page for the latest reports on cannabis in the U.S. and around the globe.
