sBDSA is highlighting the potential impact and revenues for the five states that on Nov. 5 passed ballot measures or initiatives permitting the possession of cannabis by adults.
Here are several predictions and observations coming out of Tuesday’s U.S. election:
- BDSA accurately predicted 4 of 5 new legalizations in 2021. BDSA did not expect the Montana initiative to hit the ballot this election round.
- Arizona – Voters approved a ballot measure to legalize recreational cannabis
- Mississippi – Voters passed a citizen-sponsored initiative to legalize medical cannabis, bypassing a similar ballot measure created by the state legislature
- New Jersey – Voters approved a ballot measure to legalize recreational marijuana, the first Mid-Atlantic state to do so
- Montana – Voters approved a ballot measure to legalize recreational marijuana
- South Dakota – Voters approved ballot measures to legalize both recreational and medicinal cannabis use, the first state to approve both uses in one initiative
BDSA predicts federal legalization in 2022. However, the market research firm expects that state legislation and approval will keep the category momentum in 2021.
Cannabis legalization is an issue that crosses party lines. Four of the five states that legalized marijuana in this election voted red in the 2016 election. This is a reflection that 51 percent of even the most conservative members of the population support some form of legalization for adults (medical or recreational).
The next biggest question is when the states that legalized recreational use can start selling product to consumers. In recent history, the fastest this has happened has been about 6 months but has taken up to several years. Hot markets to watch in 2021:
Arizona will be a key state to watch in 2021, as it is one of the oldest and most robust medical marijuana markets in the country. In 2019, sales at Arizona's 130 dispensaries reached $700 million and in 2020 BDSA predicts they will reach nearly $1 billion. Existing medical dispensaries will be given priority to apply for recreational licenses starting Jan. 19, 2021, with regulation for recreational use expected to be ready by April. However, BDSA recommends cannabis product manufacturers and retailers watch carefully for pushback from the state legislators in the coming weeks which could impact availability in 2021.
In New Jersey, the big question for cannabis product manufacturers and retailers will be around how fast regulations will be set as no timeline has been established. While medical dispensaries will have the first right to permits, there are currently less than 10 in the state of New Jersey compared to 130 in Arizona.
While New York legalization did not happen in 2020, Governor Cuomo has stated that cannabis legalization will be part of the 2021 budget, which would be approved in March or April. BDSA projects it to be the sixth largest market by 2025 just behind already established markets such as Arizona, California, Colorado, Florida and Illinois.