The first state to legalize recreational marijuana use is on track to see total sales top $2 billion by 2020. Colorado’s medical marijuana sales for this year are projected at $438 million, and recreational sales are forecast to reach $739 million. By 2020, medical cannabis sales are forecast to reach $663 million and recreational sales are expected to hit $1.34 billion.
Massachusetts, where voters last month chose to add recreational sales to already legal medical sales, is forecast to post sales of $1.07 billion in 2020, up from just $52 million in estimated medical cannabis sales in 2016.
The data were reported Wednesday by New Frontier Data and Arcview Market Research in separate reports on the cannabis markets in Colorado and Massachusetts.
Arcview CEO Troy Dayton said:
The naysayers said the sky would fall in Colorado and that the tax money and jobs wouldn’t ever really materialize. The naysayers were wrong. Colorado’s market has surpassed almost everyone’s expectations in terms of sales and societal benefits. It’s one of the reasons that national public support for adult-use legalization has skyrocketed to 60%.
Regarding the new market in Massachusetts, New Frontier founder and CEO Giadha Aguirre DeCarcer said:
As one of only two states on the East Coast to legalize cannabis for adult use, Massachusetts represents a significant opportunity for business owners and entrepreneurs in the space. The law does not limit product forms nor does it cap retail dispensary licenses, which are both factors that will positively contribute toward the billion dollars in sales projected by 2020.
The state report on Massachusetts projects a compound annual growth rate (CAGR) of 113%. The Colorado CAGR is forecast at 20%.
These estimates could be negatively affected by a more restrictive environment under the incoming Trump administration. Attorney General nominee Jeff Sessions has made his objections known to both legal medical and recreational marijuana. Tighter enforcement of regulations that the Obama administration chose to overlook could have a chilling effect on the cannabis industry.