With Canadian Cannabis legalization just around the corner, industry experts and analysts are already assessing the value of the next wave of legalization, sometimes referred to as Cannabis 2.0 or Legalization 2.0.
“The Tasty Future of Cannabis Edibles” was recently published by Arcview Market Research & BDS Analytics, as part of their Cannabis Intelligence Briefing Series.
The report analyzed sales and market data from various states where cannabis has been legalized.
According to the report:
Consumer spending on cannabis-based food and drink reached an estimated $1 billion in 2017 in the United States and Canada, representing about 11.4% of the total $9.1 billion in consumer spending on consumable cannabis in those two markets."
The report's overall conclusion is that:
The Edibles category could be worth more than $4.1 billion in Canada and the United States by 2022.
In Colorado, according to the report, edibles outpaced the overall cannabis growth rate, increasing at a compound annual growth rate of 35% between 2014 and 2018. Colorado is not unique, with consumers in other jurisdictions also purchasing products that are higher up the value chain than dried flower.
Arcview also looks at some major investments in the edibles sector (such as investments by Constellation Brands into Canopy Growth and rumours of an investment by Diageo Beverages into Aurora ) as a signal of future growth:
The edibles market is up for grabs. We’re already seeing mainstream beverage companies scrambling to take advantage of part of this significant opportunity.... And when you consider that the investments made so far by these beverage companies, touches primarily the beverages sub category, then you start to get a sense of the magnitude of the overall edibles market.
According to another video published yesterday on TheStreet.com, the CEO of Canopy Growth, Bruce Linton claims that cannabis related products have the potential to disrupt as much as $500 billion a year in various businesses far beyond just smoke-based delivery, including: alcohol; sleep aids; drugs for lack of appetite; sports drinks; medicines for arthritis and fibromylgia; and even pet care.
In the interview, Constellation Brands COO, Bill Newlands, predict that the legal cannabis product segment will eventually exceed $200 billion in value worldwide.
Our view is that in the next 10+ years, this is going to be a $200 billion business worldwide. And some would argue [that's] understating the case.