Cannabis legalisation trending upward
The legalisation of cannabis for recreational and medical purposes is sweeping the globe. In 2014, Uruguay became the first nation in the world to fully legalise recreational cannabis.
Following Uruguay’s trail, countries such as Canada and South Africa have fully legalised marijuana. Several countries have legalised cannabis for medical use. The United States (US) and India have complex relationships with the substance -- In both nations, cannabis is illegal on a federal level but legal in certain states.
Legal cannabis is trending worldwide. Source
The cannabis industry worldwide
The worldwide cannabis industry has experienced unparalleled levels of growth since the global legalisation trend begun. A report by Arcview Market Research and BDS Analytics, indicates that the global consumer cannabis market racked up an estimated $12.2 billion in 2018 alone. This is approximately 25% more than the income garnered in the previous year – $9.5 billion.
The industry is expected to skyrocket by 38% in 2019, with a total of $16.9 billion in sales. Compound annual sales growth between 2017 and 2022 is expected to clock in at 26.7%. At these rates, the reports estimate that by 2022, global marijuana sales will be reaching $31.3 billion.
According to Beau Whitney, a senior economist and vice president at New Frontier Data, the legal marijuana industry in the US grew to $10.4 billion in 2019. Currently, the sector employs more than 250,000 people.
In 2018 alone, $10 billion was invested into the North American legal marijuana industry. This is a far cry from the $5 billion the industry witnessed in investments three years prior. There’s an expectation that investors will raise more than $116 billion for the industry by next year.
In a study conducted by Grand View Research, Inc., the global legal marijuana market is expected to reach $146.4 billion by the end of 2025. The industry is expected to witness a compound annual growth rate of 34.6%.
The same study estimated that medical marijuana, which emerged the largest marijuana type sector in 2016, would be valued at $100.03 billion by 2025.
The Australian stance on legalisation
Since 2016, cannabis has been legal for medicinal use – under specific medical conditions – in Australia. The laws governing the use and limitations of the substance are carefully addressed in the Therapeutic Goods Administration.
Although the government maintains stringent laws on the use of the substance, many Australians actively support its legalisation. In 2016, a record 43 percent of the population – the highest in history – actively backed the legalisation of cannabis.
Australians are one of the largest consumers of marijuana in the world. The Oceania region – inclusive of countries such as New Zealand and Australia – account for 15% world’s global cannabis consumption. Cannabis is the most widely used illicit substance in the nation. A reported 12% of the population has admitted to using the substance within the past year.
The cannabis market in Oceania consists of 2.8 million consumers for a USD$5Bn market. Source
The potential of the Australian cannabis industry
According to New Frontier Data, the market for recreational marijuana would be worth an estimated $5 billion annually, if legalised. The Australian cannabis black market makes at least $4.5 billion annually. These are funds which could grow the economy and develop the nation. However, these monies are being siphoned into the pockets of criminals and organised crime rings.
Combining the recreational and medical marijuana market, the industry could garner an estimated $5.5 billion annually for the Australian economy.
The cannabis industry is now a thriving global industry with a market value placed at $12.2 billion. Following the trends of the market, the cannabis industry is projected to hit $146.4 million dollars by the end of 2025.
In Australia, 12 percent of the population have admitted to consuming cannabis within the past year, despite its illegal status in the nation for recreational use. The Australian cannabis market – if legalised for recreational purposes – is estimated at $5 billion in annual sales. These monies are currently siphoned into organised crime gangs and underworld drug world.
The Australian government loses valuable funds in tax and industry revenue, and will continue to do so as long as cannabis remains illegal. However, the climate suggests that legalisation is imminent -- perhaps it’s only a matter of time. With New Zealand on the verge of a bold step with the 2020 referendum on legal recreational cannabis, there’s a good chance Australia won’t want to remain in the dark, especially considering the market share at stake in the Oceania region.