It seems that the growth of cannabis sales is poised to continue at a steady pace, as newly released data forecasts an ongoing upward trend in sales from now until 2028. Despite a current cannabis industry that is crashing by the day, the Brightfield group sees brighter days ahead for the marijuana market. Margins may compress to very small percentages, but overall sales could still power forward as more people gain legal access to cannabis at the state level and possible Federal legalization.
On February 16th, the Brightfield Group published their “U.S. Cannabis Market Forecast,” revealing a comprehensive analysis of cannabis sales in 2022. The research also includes projections for the following five years, from 2023 to 2028. Based on their report, the cannabis market is predicted to surpass $31.8 billion in sales by the end of 2022 and is expected to reach a staggering $50.7 billion by 2028.
Although some markets, such as Arizona and Colorado, have experienced a decline in cannabis sales recently, the overall outlook on the industry remains positive. According to Matt Zehner, the insights manager at the Brightfield Group, this can be attributed to the expansion of cannabis into new markets. As Zehner explained to Forbes, 2022 was a significant year for cannabis due to the commencement of sales in seven state markets, including six for adult use and one for medical purposes, with four starting operations only in the latter half of the year.
He added that the cannabis markets in highly-populated states, including New Jersey and New York, are anticipated to experience significant growth throughout the year. Despite their slow start, both states are expected to see a substantial surge in sales. In fact, New York only recently launched sales in the final days of 2022, with 2023 marking the state’s first full year in the cannabis market.
The current momentum is expected to persist this year as more states launch their cannabis programs, such as Maryland’s upcoming adult-use program. Additionally, as highlighted by Zehner, markets like Maine and Michigan have already demonstrated steady growth.
Regional Sales Forecast
According to the Brightfield Group, the potential for a multi-state hub for cannabis exists in the eastern region of the United States. With nine states on the East Coast already allowing medical cannabis and seven states legalizing adult-use cannabis, the groundwork has been laid for this to become a reality.
The West Coast states, including Washington and Colorado, are expected to witness a surge in adult-use cannabis sales, with projections indicating that sales could reach $11.5 billion by the end of 2023 and $15.3 billion by 2028. Remember, this is just absolute sales, not profit. Quanity over quality seems to be the prediction in this report. In addition to this, the more recent entrants into the adult-use cannabis market, such as New Mexico and Arizona, are also expected to make significant contributions to this growth. However, medical cannabis sales on the West Coast are expected to decrease from $2.3 billion in 2022 to $2 billion by 2028.
The Midwest region is also poised for a tremendous surge in cannabis sales, with Missouri set to commence sales soon. Additionally, while adult-use sales have yet to be approved in Ohio and Minnesota, these markets are expected to legalize in the coming years, paving the way for significant growth. Conversely, the Southern region of the U.S. is expected to experience less change, with medical cannabis sales remaining the primary focus in this area.
The popularity of Cannabis Products
Brightfield Group’s research also delved into the popularity of various cannabis product categories. Flower continues to be the leading product category, with $11.6 billion in sales in 2022. Vape products closely followed with $5.9 billion in sales by the end of last year, while cannabis-infused beverages reached $290 million in 2022 and have the potential to soar to $640 million by 2028.
Various market reports indicate that the growth of cannabis and other psychedelic drugs will persist in the coming years. A Brandessence Market Research report published in January projected that the global market for psychedelic drugs, including psilocybin, LSD, and ketamine, could exceed $4.87 billion in 2022 and $11.82 billion by 2029.
According to the report, the market for psychedelic drugs has already become highly competitive, with businesses fiercely vying for a share of the market. This is due to the increasing acceptance of psychedelics as a treatment option for specific medical conditions. The report notes that the rising prevalence of mental disorders, including depression, and the subsequent demand for treatment are key factors contributing to the growth of the psychedelic drugs market.
Furthermore, changes in lifestyle and the desire for a higher quality of life are also expected to drive market expansion. The increase in research and development initiatives in the psychedelic medicine sector is projected to propel the market growth during the forecast period.
The burgeoning hemp industry is also set to experience significant growth, with an estimated projection of up to $18.1 billion by 2027.
The cannabis industry is poised for continued growth and expansion over the next several years, with new markets opening up and existing markets seeing steady growth. The Brightfield Group’s “U.S. Cannabis Market Forecast” provides valuable insights into the industry’s trajectory, with projections indicating that the sector will reach over $50 billion in annual sales by 2028. Similarly, the hemp industry is also expected to see a significant increase in value, highlighting the growing interest in alternative products that have therapeutic benefits. In addition, the report from Brandessence Market Research suggests that the acceptance and demand for psychedelic drugs are rising, making it another emerging market that could see tremendous growth in the future.
As the industry continues to evolve, so will the landscape of regulations, consumer preferences, and product offerings. The potential for continued growth in these markets presents numerous opportunities for businesses and entrepreneurs to develop new and innovative products and services that cater to the evolving needs of consumers. With so much growth potential, the cannabis, hemp, and psychedelic industries are sure to remain hot topics of interest in the years to come.