Pot Sales Hit $6.7 Billion in 2016; What Could Kill Weed’s Momentum?
The market is certainly showing no signs of contracting.
If North America’s $6.7 billion in marijuana sales for 2016 doesn’t strike you as an impressive pile of taxable cash, then take a look at how that mountain of revenue came to be: The past year's retail pot receipts grew by 30 percent over 2015’s totals. That kind of expansion causes publications like Forbes to toss around the word unprecedented.
The sales figures, which include over-the-counter pot buys in Canada, are disclosed in an upcoming report from Arcview Market Research. Arcview is a firm of investment strategists specializing in emerging cannabis industries. So far, the company has guided investors in placing a reported $91 million with 135 companies. Arcview is in the business of being bullish on marijuana commerce, but its figures seem to check out with at least one mainstream financial publication.
Thirty percent is an astounding number especially when you consider that the industry is in early stages.
Arcview's new editor-in-chief Tom Adams said, “The only consumer industry categories I've seen reach $5 billion in annual spending and then post anything like 25% compound annual growth in the next five years are cable television (19%) in the 1990's and the broadband internet (29%) in the 2000's.”
Going forward, Arcview projects annual North American weed sales exceeding $21.2 billion within the next five years, even if the growth rate slows down to 25 percent.
The Arcview data was collected and churned from numbers provided by BDS Analytics, a firm that tracks cannabis market share and provides business intelligence.
One piece of intelligence that neither Arcview or BDS Analytics or anyone else can provide at this moment is whether or not the incoming administration of President Elect Donald Trump will move to inhibit the recreational marijuana industry and/or impose stricter guidelines on medical marijuana distribution. Trump’s picks for Attorney General, Secretary of Health and Human Resources, and Director of Homeland Security have all voiced opposition to legalizing, or even decriminalizing, marijuana.
The distaste for marijuana in Trump's picks seems to be based primarily on ideological grounds. The question is, will that ideology outweigh $21.2 potential billion in yearly economic activity from the pot sector by 2021?