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The High Future of Cannabis Industry

July 09, 2021

The High Future of Cannabis Industry

It’s the world’s most ordinarily cultivated, trafficked, and used an illicit drug. Because of the impact of legalization response and outside grows, cannabis is garnering significant attention from investors, companies, and researchers. 

Despite the plant being prohibited under federal law as a Schedule I drug, the U.S. legal cannabis industry was estimated at $10.4 billion in 2018. It includes 250,000 jobs dedicated to the handling of plants, consistent with New Frontier Data. A complete 33 states have legalized homegrown cannabis for medical use, 10 of which permit adults to use the drug for recreational use legally. 

The number may still rise, as more people are accepting the thought of legalizing marijuana across the U.S. This text looks at a number of the uses of marijuana also because of the overall marketplace for the drug.

Changing Attitudes Toward Cannabis

The “Reefer Madness”; the flick from the 1930s that was created to convince parents and their children about the menace of marijuana? The film was initially intended to reach audiences but has now become a cult classic and a bit of irony.

Just like the view on the film has changed, so too are people’s opinions about cannabis itself. This is often very true as we learn more about the drug and, therefore, the apparent benefits that accompany using it for medical purposes. Once considered a bootleg substance, it’s still deemed a controlled drug under federal guidelines. But the stigma is being cast at a wide-ranging speed, and it appears cannabis is on its thanks to the mainstream.

According to a survey, about 62% of Americans believe the utilization of cannabis should be legalized. This is often double what it had been in 2000—31%—and five times what it had been in 1969—12%.

 A replacement York University study revealed the share of adults aged 50 to 64 reporting marijuana use has doubled within the past decade to 9% and use among adults 65 and older has increased seven times during an equivalent period to just about 3%. The American cannabis industry will generate $17.5 billion in tax income by 2030.

More states may legalize cannabis

Several 2020 presidential election candidates have shown their provision for legal cannabis. Here are a number of the notable names and the way they feel:

Former vice-chairman Joe Biden wants marijuana also decriminalized as holding the criminal records of those sentenced to possession of the drug effaced.

South Bend Mayor Pete Buttigieg requires all drugs decriminalized, calling for lessening penalties for drug offenses and getting restrain drug possession convictions altogether.

Sen. Kamala Harris is one among the sponsors of a bill called the Marijuana Justice Act alongside Sens. Cory Booker and Elizabeth. As a part of their platform, the three senators support expunging convictions for those caught with marijuana, and every call out for a path toward decriminalization and legalization.

Policy Reform

With Jeff Sessions gone and therefore the Democrats on top of things of the House, significant cannabis reform seems possible this year. 

Politicians acknowledged that 296 members of Congress (68%) represent the 33 states with a minimum of medical cannabis, which suggests there are sufficient votes to pass long-awaited bills. There are already several bills within the new Congress concerning the plant.

Cannabis companies raised $13.8 billion in funding in 2018, consistent with cannabis industry research firm Viridian Capital Advisors. This was fourfold the quantity built-in 2017. We expect this trend to continue, but essential to the U.S. industry is additionally banking reform. Big banks are currently scared of concealment charges they’ll face if they work with these businesses. 

Besides the problem of getting capital, this suggests huge risks and a nuisance for companies operating in cash. The American Bankers’ Association has been contending for more legal clarity and bridging of the gap within federal and state law, and that we could see banks warm up to cannabis if bills just like the SAFE Banking Act are passed.

The CBD Bandwagon

Marijuana has been used as a drug in several cultures for thousands of years. The federal law banning it within the U.S., the Marihuana Tax Act, was passed in 1937. There are growing numbers of acceptance of the plant as a legitimate option for patients that suffer from medical problems like chronic pain or seizures in modern-day America.

This is mostly because of cannabidiol or CBD —a natural compound found in non-psychoactive cannabis plants. This suggests it doesn’t make the buyer high. CBD is marketed as an ingredient in oils, creams, oral sprays, pills, or edibles like gummies and lollipops. Purveyors claim CBD can provide relief from pain, combat anxiety, and depression. It’s even been linked to helping people living with cancer.

It’s true CBD has its moment. The term CBD gummies were the third-most searched food-related term on Google within the U.S. in 2018. Big companies like Corona owner Constellation Brands and Altria Group— the maker of Marlboro cigarettes have bought multibillion-dollar stakes in marijuana companies. But forecasts for the CBD market argue this is not just a short-lived wellness craze.

New Frontier Data estimates the marketplace for CBD derived from hemp will grow from a $390 million-dollar market in 2018, to a $1.3 billion market—or 3.3x—by 2022. Brightfield Group says the hemp CBD market can reach the maximum amount of $22 billion by 2022. 

Defending its lofty prediction, Brightfield’s director Bethany Gomez said, “We are a team of highly conservative analysts and that we didn’t take this lightly – I honestly believe that these are conservative numbers. We’ve no rose-colored glasses in terms of the bizarre and challenging regulatory framework that surrounds this industry, it’ll always be two progress, one step back. There are bound to be some problematic regulations and bumps along the way. But there’s an excessive amount of momentum, an excessive amount of demand, and an excessive amount of potential for this industry to not explode.”