By: Jeremy Berke
- Legal marijuana is set to hit $75 billion in sales by 2030, according to a note from analysts at the investment bank Cowen.
- Weed is already putting pressure on alcohol sales. In states that have legalized marijuana, binge drinking rates are declining.
- The market for marijuana could eventually eclipse soda sales.
Cannabis could soon become a bigger industry than soda, and it has already started putting pressure on alcohol sales.
If marijuana is made legal nationwide in the US by 2030, the legal weed industry could generate $75 billion in sales by that year, according to a new note from the investment bank Cowen.
Cowen’s cannabis sector analyst, Vivien Azer, revised her previous estimate up by $25 billion. Legal marijuana sales are already around $50 billion, Azer said in the note.
Soda consumption, on the other hand, is declining. Per capita consumption fell to a 31-year low in the US in 2016, Bloomberg reports, with $76.4 billion in sales in 2017.
Legal marijuana is already starting to impact alcohol sales as well.
In states that have legalized cannabis, binge-drinking rates have fallen 9% below the national average, and 11% below states that don’t allow the sale of recreational marijuana, according to the note. Adults in states with legal cannabis binge drink an average of 13% fewer times per month than those in states without legal recreational marijuana.
“This work builds on our prior assertions that cannabis acts as a substitute social lubricant for consumers,” Azer said in the note.
“As cannabis access expands, we expect further pressure on alcohol sales, given this notable divide in consumer consumption pattern,” she added.
The cannabis market is still far behind alcohol, however. Sales of alcohol hit $210 billion in 2017, according to the note.
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