The past few years have seen struggles for many businesses including those in the cannabis industry. With the aftermath of a global pandemic along with rapidly rising inflation rates, still, the future is looking bright for the cannabis industry. In this light, let’s look at what the growing cannabis industry might look like in 2023 and beyond.
The Cannabis Industry in 2023
According to industry analysts, even without legalization on a federal level, legal cannabis sales in the United States still have the potential to grow at a double-digit compounded annual growth rate. However, there is also increased competition coming from illicit marketplaces that are likely to drive consolidation within thousands of different US brands.
States Where it’s Already Legal or on the Brink of Legalization
California was the first to legalize the use of medical marijuana in 1996 and then recreationally in 2016. Maryland, Missouri, and Mississippi are the most recent states to climb on board the cannabis train. In total, it’s legal to use for medical purposes in 39 states and the District of Columbia with adult recreational use in 21 states and DC. In 2023, watch for:
- Delaware, Minnesota, Ohio, Oklahoma, and Pennsylvania to go towards recreational usage to become legal
- Kansas and North Carolina are highly likely to go on record for recreation use status soon.
The Political Challenges Facing Cannabis in 2023
Many often wonder what is taking the federal government so long to legalize cannabis especially considering they’ll likely tax it heavily similar to how they tax the sale of tobacco and alcohol.
Looking past all the rules and regulations they’ll put into place, there are other struggles and challenges the federal government faces. As an example, things like distribution and packaging will differ greatly with a plant rather than a chemical compound.
This is a tall order given FDA (Food and Drug Administration) approval standards. (This assumes by the way that all cannabis and/or marijuana products will fall under FDA jurisdiction.)
Obviously, things like edibles and medicinal treatments like topicals will need the FDA’s signature of approval, but what about smoking these substances? Is this where the AFT (Bureau of Alcohol, Tobacco, Firearms, and Explosives) steps in to govern, tax, license, and monitor these products? The lines are quickly blurred when you consider many companies take marijuana meant to be smoked and create an edible or topical method delivered from these substances.
Economic Outlook for 2023
According to trusted statistics, the forecast for the cannabis industry is looking very bright for 2023. Global revenue is projected to reach over $27 billion with an annual growth rate of almost 13.7%. Most of this revenue will be generated in the United States in 2023 with nearly $33 billion of sales and roughly $332 spent per person annually in the US.
Given this type of exponential growth, the cannabis industry is still considered to be in its emerging stage and phase with excellent investment possibilities. Along with the loosening of legal restrictions, higher social acceptance rates have delivered flows into infrastructure, technology, and real estate. There are multiple reasons for this expansion including the outbreak of COVID-19 which led to social isolation, increased stress, and anxiety believed to have contributed to higher usage of cannabis around the globe.
When you’re looking for more insightful, eye-opening, and important information on cannabis industry trends, continue to follow our blog. If you ever have any direct questions, comments, or concerns, please feel free to contact us today especially if you’re seeking to conquer the challenges of automation in the cannabis industry. When you have questions, we have the answers and we’re looking forward to hearing from you.