As voters in more states embrace legalized marijuana sales, the burgeoning cannabis industry has gone from a curiosity to a bona fide booming market.
Just how big is the market for legal pot? A new report by a leading marijuana industry investment and research firm found legal cannabis sales jumped 17%, to $5.4 billion, in 2015 and they will grow by a whopping 25% this year to reach $6.7 billion in total U.S. sales.
The numbers are staggering, considered the first recreational dispensaries opened for business in Colorado only two years ago.
On Monday, ArcView Market Research will release its fourth edition of The State of Legal Marijuana Markets report, and it includes the prediction that the legal cannabis market will see a whopping $21.8 billion in total annual sales by 2020. (By comparison, at that point, the legal marijuana market could be bigger than the National Football League, which saw roughly $12 billion of revenue last year but is aiming to reach $25 billion by 2027.)
ArcView expects the legal pot market to show a compound annual growth rate of nearly 30% over the next few years. “I think that we are going to see in 2016 this next wave of investors, the next wave of business operators, and people who’ve sort of been watching or dipping their toe in, really starting to swing for the fences and take it really seriously,” ArcView CEO Troy Dayton said in an interview. ArcView Market Research, part of cannabis industry investor network ArcView Group, provides some of the most regularly-cited figures and estimates on the market for legal marijuana. In November, ArcView announced a new partnership with cannabis industry data analytics firm New Frontier to co-publish and co-produce its annual report. And this partnership yielded “by far the most comprehensive report,” Dayton said. Rather than just focusing on medical and recreational dispensaries’ sales, the report tracks a wide variety of legal marijuana sales, including cannabis products sold through delivery services and medical marijuana “caregivers,” who can legally grow and distribute the drug.
ArcView’s latest projections are cause for even greater optimism for the cannabis industry than in previous reports, which previously estimated $2.7 billion total industry sales for 2014 (ArcView now estimates $4.6 billion in sales that year) while predicting that the market would grow to $10.8 billion by 2018.