Cannabis Sales Projected to Double In Washington State By 2020
Changes to Washington state’s legal cannabis industry will drive up annual sales to $2.4 billion by 2020, “The Washington market is maturing, but it has a long way to go to reach saturation. It will practically double by 2020. People really like cannabis and the regulated market is beating the underground market, as predicted,” Troy Dayton, CEO of Oakland, California-based Arcview Group, said in a statement.
ArcView, which has an investor network and has formed a number of cannabis ventures, issued the report with New Frontier, a Washington, D.C.-based big data company that analyzes the legal pot industry.
Changes in Washington State
Washington state has made some changes to its legal pot business, including folding the medical-marijuana sector into the recreational sales side of the business. As a result, medical marijuana patients now have to pay the 37 percent excise tax on cannabis, and the state has increased the number of retail licenses that will be made available from 334 to 556.
The elimination of the medical system makes will drive up annual sales in recreational pot shops to $2.4 billion by 2020, according to Arcview.
But it will be at least another year before the impact of these changes on product supply and consumer behavior will be fully understood, New Frontier Founder & CEO Giadha Aguirre DeCarcer said.
Washington’s combined medical and recreational use sales are projected to grow from $1.2 billion in 2016 to $2.4 billion in 2020, a compound annual growth rate of 23 percent.
In 2014, average monthly sales were $10.8 million. By 2015 average monthly sales increased five-fold to $51.2 million. This then doubled in 2016 to more than $111.6 million, with strong demand expected to continue in 2017, according to Arcview.
Marc Stiles covers real estate for the Puget Sound Business Journal.