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California's Legal Cannabis Market To Reach $3.1B In 2019 Sales, Report Says

California's Legal Cannabis Market To Reach $3.1B In 2019 Sales, Report Says
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A new report by Arcview Market Research and BDS Analytics projects California’s legal cannabis market to reach $3.1 Billion in 2019 Sales. The firms are forecasting a 19% compound annual growth rate over the next five years, which will place annual consumer spending at $7.2 billion in 2024.

"Despite the burdens imposed on the legal market by regulators, with a $2.7 billion gross domestic product, California has the world's largest legal cannabis market and will continue to until federal legalization makes it merely a part of the larger U.S. market," said Tom Adams, Managing Director and Principal Analyst for BDS Analytics' Industry Intelligence group and Editor-in-Chief for Arcview Market Research.

A State In Recovery

According to the report, states like Colorado, Oregon and Washington saw consumer spending on adult-use cannabis double within the first year of recreational legalization.

California however, was the first state to lose consumer spending in an year-over-year basis since switching to adult-use from a medical-only framework. The market shrunk from $3 billion in 2017 to $2.5 billion in 2018 due to local bans on commercial activity and strong testing regulations. Product shortages caused a big number of suppliers to shut down activities.

"California companies that survived the dual 'extinction events' of 2018 have emerged stronger and well-positioned to grow their market share going forward," said Troy Dayton, CEO of the Arcview Group. "More than that, they are battle hardened, and kicked off a merger and acquisition flurry in the first half of 2019 that will allow them to leverage their positions in California to compete across the country."

With a better established local industry, the Sunshine State is set to recover from its initial setback and grow consistently, achieving 2017’s spending numbers back by the end of this year.

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Posted-In: ArcView Group BDS Analytics California Troy DaytonCannabis Markets Best of Benzinga


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