A new report predicts that the global recreational cannabis market will nearly double by 2027, reaching a value of almost $50 billion per year. The report, released by Prohibition Partners, attributes this growth to the increasing momentum in cannabis reform worldwide, as well as the opening of new recreational cannabis markets in Europe over the next few years. North America is expected to remain the leader in legal cannabis sales, with the United States and Canada driving growth in the industry. The report also highlights the potential for growth in other regions, such as Europe, Latin America, Africa, and Oceania. With continued policy reform and legalization efforts, the global cannabis market is projected to experience significant expansion in the coming years.
Welcome to this comprehensive article about the global recreational cannabis market. In this article, we will explore the current state of the market, factors driving its growth, and projections for its future. We will also delve into specific regions, such as North America and Europe, and examine their influence on the global market. Furthermore, we will discuss key countries for growth, ongoing legal confusion, and forecasted sales by 2027. Additionally, we will take a closer look at Canada and the United States, two major players in the cannabis industry. Lastly, we will explore the expansion into other regions, industry growth over the past year, and conclude with an overview of the market. So grab your favorite strain, sit back, and join us on this journey through the world of recreational cannabis.
Global Recreational Cannabis Market
The global recreational cannabis market is poised for significant growth in the coming years. According to a new report from Prohibition Partners, legal sales of adult-use cannabis are projected to nearly double by 2027, reaching nearly $50 billion per year. This growth is attributed to the global momentum in cannabis reform and the opening of new recreational cannabis markets in Europe. North America, with its state-by-state growth, promising regulatory reforms, and international isolationism, remains the global powerhouse of legal cannabis. Europe, on the other hand, presents a fragmented and heavily regulated business environment, with steady growth concentrated in key countries, incremental progress on adult-use legalization, and ongoing legal confusion over CBD.
North America as Global Powerhouse
North America continues to dominate the global adult-use cannabis market. With its strong state-by-state growth, promising regulatory reforms, and international isolationism, the region remains at the forefront of the industry. Each state in the United States has its own unique approach to cannabis legalization, resulting in a diverse and vibrant market. Regulatory reforms, such as new state laws and initiatives, are driving the growth of the industry. International isolationism, particularly in the United States, has created a favorable environment for domestic cannabis companies to flourish.
The growth of the recreational cannabis market in North America can be attributed to the continued legalization efforts at the state level. Currently, 24 states in the United States have legalized recreational marijuana, allowing for the cultivation, sale, and use of cannabis by adults. These states have created a thriving industry, providing employment opportunities and generating tax revenue. The growth of the market in Canada, which legalized cannabis for adults in 2018, is also contributing to the region’s dominance in the global market.
Regulatory reforms play a crucial role in driving the growth of the recreational cannabis market. States in North America are introducing new laws and initiatives to regulate the industry, ensuring consumer safety and generating tax revenue. These reforms include licensing requirements, quality control measures, and strict labeling regulations. Furthermore, regulatory changes at the federal level, such as the decriminalization of cannabis, could have a significant impact on the market’s growth.
International isolationism, particularly in the United States, has created a unique environment for the domestic cannabis industry. With limited imports and exports of cannabis products, North American companies have been able to establish a strong foothold in the market. This has allowed them to expand their operations and increase their market share. However, as global cannabis reform continues, it remains to be seen how international trade will impact the North American market.
Europe: Fragmented and Heavily Regulated
Unlike North America, Europe presents a fragmented and heavily regulated business environment for the recreational cannabis market. While there is steady growth concentrated in key countries, the industry faces challenges due to regulatory restrictions and ongoing legal confusion over CBD. However, with incremental progress on adult-use legalization and the opening of new markets, Europe is poised for growth in the coming years.
Key Countries for Growth
Several key countries in Europe are driving the growth of the recreational cannabis market. These countries include Malta, Switzerland, the Netherlands, and Germany. Malta became the first country in Europe to legalize recreational marijuana, although only nonprofit cultivators and dispensers are currently allowed to operate. Switzerland is conducting several recreational marijuana pilot programs, while the Netherlands has a research-based legalization plan. Germany is in the process of adopting an adult-use cannabis legalization plan, which could go into effect soon.
Incremental Progress on Legalization
Europe is making incremental progress on adult-use legalization. While the industry is still in its infancy, several countries are exploring the possibility of legalizing recreational cannabis. These countries recognize the potential economic benefits and are taking steps to regulate the market. As these countries continue to develop their policies and regulations, the recreational cannabis market in Europe is expected to grow.
Ongoing Legal Confusion over CBD
One major challenge in Europe is the ongoing legal confusion over CBD. CBD, or cannabidiol, is a non-psychoactive compound found in cannabis plants. While CBD products are widely available in Europe, the regulations surrounding their legality vary from country to country. This creates uncertainty for businesses and consumers alike. However, as the market matures and regulations become clearer, the recreational cannabis market in Europe is expected to overcome these challenges.
Forecasted Sales by 2027
The forecasted sales for the global recreational cannabis market are promising. According to the Prohibition Partners report, global annual sales of recreational cannabis are projected to reach approximately $49.7 billion by 2027. This represents nearly double the current sales of $24.9 billion. The growth of the market will be driven by continued policy reform in the United States and Europe, as well as the opening of new markets in emerging regions.
Global Annual Sales of Recreational Cannabis
The global annual sales of recreational cannabis are expected to reach $49.7 billion by 2027. This growth is driven by increasing legalization efforts and changing attitudes towards cannabis worldwide. As more countries recognize the economic potential of the cannabis industry, they are taking steps to legalize and regulate it. This, in turn, is fueling the growth of the recreational cannabis market.
Sales in North America
North America will remain the global leader in worldwide adult-use cannabis sales. With its strong state-by-state growth and promising regulatory reforms, the region is well-positioned to dominate the market. In Canada, where cannabis has been legalized for adults since 2018, sales currently approach CAD 6 billion, with the majority coming from recreational cannabis sales. In the United States, where cannabis remains illegal at the federal level, sales totaled about $26 billion in 2022, including both recreational and medical marijuana.
Sales in Europe
While Europe presents a challenging business environment for the recreational cannabis market, sales are expected to grow in the coming years. Incremental progress on legalization and the opening of new markets will drive this growth. As more countries in Europe adopt adult-use cannabis legalization plans, sales will increase. However, the industry will still face regulatory restrictions and ongoing legal confusion that may impact sales.
Canada: Leader in Cannabis Sales
Canada has emerged as a leader in the global cannabis industry. Since legalizing cannabis for adults in 2018, the country has experienced significant growth in the market. With approximately 3,000 retail cannabis shops across the country, Canada has created a thriving industry that generates billions of dollars in sales.
Current Sales Figures
Overall sales of cannabis in Canada currently approach CAD 6 billion, with recreational cannabis sales accounting for the majority. The remaining sales come from medical marijuana. The market has seen steady growth since legalization, with an increasing number of consumers choosing to purchase cannabis for recreational use.
Breakdown of Sales
In Canada, recreational cannabis sales account for 93% of the total market, while medical marijuana sales make up the remaining 7%. This breakdown reflects the demand for cannabis for adult use and highlights the popularity of recreational products in the country.
The cannabis market in Canada is projected to continue growing in the coming years. As more consumers embrace recreational cannabis and the industry expands, sales are expected to increase. The country’s strong international presence and growing domestic market contribute to its projected growth.
United States: Legalization and Sales
The United States presents a complex landscape for the recreational cannabis market due to its federal illegality. However, individual states have taken the initiative to legalize cannabis for recreational and/or medical use, driving the growth of the industry.
Currently, 24 states in the United States have legalized recreational marijuana, allowing for the cultivation, sale, and use of cannabis by adults. These states have created a thriving market, with each state adopting its own regulations and licensing requirements.
Recreational and Medical Sales
In the U.S., sales of cannabis are divided between recreational and medical markets. In 2022, total sales of cannabis reached approximately $26 billion, with $17 billion from recreational cannabis and almost $9 billion from medical marijuana. This division reflects the different needs and preferences of consumers.
The recreational cannabis market in the United States is projected to see significant growth in the coming years. As more states legalize recreational marijuana and regulatory reforms take place, sales are expected to increase. By 2027, total sales in the U.S. are forecasted to reach $33 billion.
Expansion into Europe and Other Regions
The global recreational cannabis market is expanding beyond North America into other regions, including Europe, Latin America, Africa, Oceania, and Asia. As more countries recognize the economic potential of the cannabis industry, they are taking steps to legalize and regulate it.
Emerging Markets in Latin America and Africa
Latin America and Africa are slowly emerging as sources of supply for the global cannabis industry. While access for patients remains limited, countries in these regions are exploring the potential of the cannabis market and are taking steps towards legalization.
Growth in Oceania
Oceania, which includes countries like Australia and New Zealand, is experiencing significant growth in both imports and exports of cannabis products. The region presents opportunities for companies to expand their operations and tap into a growing market.
Untapped Asian Market
The Asian market remains largely untapped in the global recreational cannabis market. With exceptions like Thailand and Japan, where limited progress has been made, the region has yet to embrace widespread legalization. However, as attitudes towards cannabis change and the industry evolves, the Asian market may present new opportunities for growth.
Industry Growth Over the Past Year
The past year has been a period of growth and progress for the global cannabis industry. In both the adult-use and medical markets, significant advances have been made. New regulations, progressive reforms, and increased commercialization have set the stage for a positive future for the industry.
Advances in Adult-Use and Medical Markets
The past year has seen advances in both the adult-use and medical markets. More countries have moved towards legalizing recreational cannabis, while the number of medical cannabis patients has been increasing globally. These developments reflect the growing acceptance and understanding of the benefits of cannabis.
Progressive Reforms and Commercialization
Progressive reforms and increased commercialization have played a vital role in the growth of the cannabis industry. Regulatory changes at the state and federal levels, such as the decriminalization of cannabis and the introduction of new licensing requirements, have created a more favorable environment for businesses. This, coupled with the commercialization of cannabis products and services, has contributed to the market’s expansion.
In conclusion, the global recreational cannabis market is on track for significant growth in the coming years. North America remains the global powerhouse of legal cannabis, with state-by-state growth, regulatory reforms, and international isolationism driving the industry. Europe, while presenting a fragmented and heavily regulated business environment, is experiencing incremental progress on legalization and ongoing legal confusion over CBD. Canada and the United States are leaders in cannabis sales, with projected growth in both countries. Furthermore, the industry is expanding into other regions, such as Latin America, Africa, Oceania, and Asia. Over the past year, the cannabis industry has seen growth in the adult-use and medical markets, with progressive reforms and increased commercialization. As we look towards the future, the global recreational cannabis market holds tremendous potential for further expansion and innovation.