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The global cannabis industry is expected to make $35 billion in total sales in 2022, according to a new industry report by BDS Analytics. The company's new five-year report predicts that new cannabis markets in Mexico and the US will help the global weed market grow by 22% this year, up from $29 billion in 2021. From there, the industry is tipped to expand at a 15% compound annual growth rate until 2026.
America's adult-use and medical cannabis industries, which rake in more than $18 billion a year, account for nearly two thirds of these global sales. In 2021, most of the industry growth happened in the Midwest. Illinois made $1.8 billion in 2021, a 70% market share increase over 2020, and Michigan matched its neighbor with $1.79 billion in sales. Missouri's new medical pot market also surprised industry experts by exceeding $210 million last year.
This year, US sales will expand even further as existing markets mature and new markets open their doors. “New Jersey’s launch of adult-use sales, expected in the second quarter, will likely cause the most substantial jump in any market in the US in 2022,” said BDSA Chief Commercial Officer Jessica Lukas to Forbes. The Garden State still hasn't begun selling adult-use pot yet, but is still predicted to sell $792 million worth of legal weed by year's end.
“Georgia, New Mexico, and Montana are also expected to add considerable growth in 2022 with new or expanded medical and/or adult-use markets,” Lukas continued. “As always, despite slowing growth, California is and will continue to be the largest US cannabis market and the largest global cannabis market.”
As large as it is, the Golden State's legal weed industry has been plagued with excessive taxes, wildfires, robberies, and a thriving black market. And to make matters worse, 77% of state municipalities have banned local weed businesses, making it hard for consumers to shop for legal bud. Politicians are finally starting to consider reforming pot tax laws, though, especially after weed businesses began planning a tax revolt. Several cities and counties have also stepped up to provide temporary tax relief.
Outside of the US, the global weed industry has been making some modest gains. Canada, despite being the world's largest country to fully legalize adult-use sales, only contributed $3.8 billion to the global weed market last year. This year, BDSA predicts that sales will climb to $4.7 billion, mostly driven by market expansion in Ontario and British Columbia.
The rest of the world is lagging far behind North America when it comes to cannabis. Medical marijuana is legal in the UK and most European countries now, and Uruguay legalized adult-use weed in 2013, but these markets only made a combined $1.4 billion in sales – less than most individual US states did. BDSA predicts that international sales will hit $2.2 billion in 2022, though, and then grow by 46% annually until 2026, driven by dozens of new markets.
Mexico is expected to lead the pack when it comes to future international sales once it kicks off its adult-use pot market next year. Germany is next in line, with a $5 billion adult-use market predicted to begin in 2024. Thailand, the first Southeast Asian country to legalize medical marijuana and to fully decriminalize cannabis, may also play a growing role in the global market.