As the Golden State prepares to roll out new medical and recreational regulations on Jan. 1, 2018, a recent California cannabis study has estimated that all of that preparation will result in a $5 billion windfall for the state’s legal market.
According to a study by the University of California Agricultural Issues Center,”[AIC analysts] estimate that as of November 2016, aggregate annual sales in the medical segment were $2 billion per year, sales in the illegal segment were $5.7 billion, and total cannabis industry sales were $7.7 billion.”
While the California cannabis study, prepared on Feb. 23, 2017, estimates that the newly legal recreational sector will capture 61.5% of the overall market, it also predicts that illegal sales will capture 29.5% of the overall market, leaving legal medical sales with approximately 9%.
AIC’s legal cannabis market estimate for California joins a host of other estimates from industry members and analysts. California State Treasurer John Chiang has projected that the state’s legal cannabis sales will hit $7 billion annually; MedMen has estimated that annual recreational annual sales will generate an additional $8.38 billion; meanwhile, ArcView and New Frontier have estimated that the state’s cannabis sales will grow from $2.8 billion in 2016 to $6.5 billion by 2020.