Cannabis Reforms Sweep the United States
July 11th, 2018
Cannabis reform is finally coming to the United States this year, in the form of legalized adult-use cannabis in California and progress towards medical cannabis legalization nationwide. Investors may want to keep a close eye on these trends as the market could reach over $50 billion in size by 2026, according to Cowen & Co. analysts, driven by the liberalization of cannabis policy and growing public demand.
States’ Rights Win Out in the USA
The Trump Administration has held opposing views on cannabis legalization. While the appointment of Attorney General Jeff Sessions and the rescinding of the Cole Memo was certainly a negative development for the industry, President Trump recently indicated that he would support a new bipartisan bill sponsored by Sen. Cory Gardner and Sen. Elizabeth Warren to give marijuana growers and sellers better access to the formal financial system and ultimately return regulation to states rather than the federal government.
Libertarian Republicans, like Sen. Cory Gardner, tend to support cannabis legalization on states’ rights grounds, but even Republicans opposed to national legalization on moral grounds may be ready to change the mind along with voter sentiment. A late 2017 Gallup poll found that 64 percent of voters believe that cannabis should be legalized — including more than 50 percent of Republicans for the first time in history. And, President Trump is well known for being a politician that supports people over policy.
The new bill would close a key legal gap in the burgeoning industry. As it currently stands, the Rohrabacher-Blumenauer amendment limits Department of Justice’s firepower, but marijuana remains federally illegal on the list of banned Controlled Substances. The new bill would make it illegal, rather than inconvenient, for the federal government to interfere in state marijuana industries, which would in turn make it easier for banks and other legitimate industries to get involved with the sector to reduce crime and uncertainty.
Recreational Cannabis Begins in California
California voters legalized adult-use cannabis in November 2016, but it took more than a year for recreational cannabis to hit store shelves. On January 1, 2018, it became legal for any U.S. adult over the age of 18 to purchase cannabis for recreational purposes in California, which created one of the largest markets in the world overnight. Analysts believe that the market could bring in nearly $8 billion over the next four years.
Despite the legalization, there have been some growing pains along the way. Many black market growers have struggled to secure licenses in the new legitimate market, which has led to some concerns given that large investors and companies have been overwhelmingly benefiting at the expense of smaller growers. Local governments are trying to address these concerns and bring smaller growers into the fold, but in some cases, large swaths of marijuana crops have been destroyed as the black market is shut down.
California could also be a tipping point for the United States to bring adult-use legalization across the nation. While Colorado, Washington, and Oregon were early pioneers with recreational cannabis legalization, California is the most populous state and could be a more realistic proving ground for the entire nation. The successful rollout of a recreational cannabis program could demonstrate the viability of the legalization movement and open the door for lawmakers to push for broader national level legalization.
Keeping Up with the Trends
The National Cannabis Industry Association, or NCIA, is the only national trade association advancing the interest of legitimate and responsible cannabis industry participants. With hundreds of top companies participating, the group has become an important lobbyist and voice for the industry to lawmakers in the United States and has become a leading voice around the world.
The group has several upcoming conferences where companies, advocates, and other parties can gather to discuss these recent events and how the industry landscape is evolving.
NCIA’s 5th Annual Cannabis Business Summit® & Expo 2018
July 25 – 27, 2018 – San Jose, CA
CCIA’s & NCIA’s California Cannabis Business Conference 2018
October 22 – 23, 2018 – Anaheim, CA
NCIA’s Seed to Sale Show® 2019
February 12-13, 2019 – Boston, MA
For more information on becoming a member, visit the organization’s website at https://thecannabisindustry.org.
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CFN launched in June of 2013 to initially serve the growing universe of publicly traded marijuana companies across North America. Today, CFN Media is also the digital media choice for the emerging brands in the space.
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