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  • Writer's pictureEvan Smith

US Legal Cannabis Market Anticipated to Surge by 14% in 2023


A comprehensive report from Colorado-based cannabis industry market analysis firm BDSA predicts a 14% growth in legal cannabis sales in the United States in 2023. The updated five-year global legal cannabis market forecast highlights that global spending on legal cannabis rose by 4.8% to $32 billion in 2022. Between 2022 and 2027, the global cannabis market is projected to experience a compound annual growth rate (CAGR) of 13.2%, culminating in a total regulated market size of $59.6 billion by 2027.


The US legal cannabis market has witnessed substantial expansion as a growing number of states legalize adult-use cannabis and medical marijuana. Despite the industry's slowed growth in 2022 due to increasing inflation and economic uncertainty, BDSA projects a 14% increase in the US legal cannabis market in 2023.


Roy Bingham, co-founder and CEO of BDSA, attributed the decline in cannabis spending in 2022 to dropping prices across all markets. However, he anticipates robust growth in the US, driven by developing markets such as Missouri, New Jersey, and New York.


As of now, 21 states have legalized cannabis for adult use, while 37 states, the District of Columbia, and three US territories have legalized medical marijuana. Moreover, 11 states permit low-THC cannabis formulations for medicinal purposes. Idaho and Nebraska are the only states where all forms of cannabis are prohibited.


Several mature cannabis markets, including California, Colorado, Nevada, and Oregon, experienced a 16.5% decrease in legal adult-use cannabis spending in 2022. BDSA expects these established markets to return to positive growth in 2024, albeit at a slower pace through 2027 than in the years preceding the pandemic.


In contrast, newer legal cannabis markets demonstrated strong growth in 2022. BDSA predicts additional legal adult-use cannabis markets will emerge by 2027, with Maryland commencing sales in 2024 and Florida and Ohio following suit in 2025. Minnesota and Hawaii may also launch legal sales by 2027. However, BDSA does not foresee federal cannabis legalization within the five-year forecast period.


Brian Vicente, founding partner of cannabis law firm Vicente LLP, concurred that emerging markets would play a vital role in driving the growth of the legal cannabis industry in the coming years. He highlighted the revenue growth in newly-legal cannabis markets like Missouri and New Jersey and emerging medical markets such as Mississippi. With Florida and Ohio likely to legalize cannabis in the next few years, Vicente expects continued expansion in cannabis sales.


By 2027, US adult-use cannabis sales are projected to represent 78% of total global legal cannabis spending, up from 64% in 2022. The US legal cannabis market is expected to grow at a CAGR of 11.3%, from $26.1 billion in 2022 to $44.5 billion in 2027. The primary drivers of this growth will be the recreational marijuana markets in New York, Florida, New Jersey, and California.


Outside the US and Canada, global cannabis markets are anticipated to grow at a CAGR of 40%, reaching $9.5 billion in 2027, up from $1.8 billion in 2022. Canada's market is forecast to grow by 12% this year and reach $5.7 billion by 2027 at a CAGR of 6.3%. The primary drivers of global growth are expected to be new adult-use markets in Germany and Mexico, accompanied by the expansion of existing limited medical cannabis programs in the European Union and Latin America.


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