The passage of major legalization measures will see the nation’s legal marijuana industry to grow eight-fold over the next ten years.
Five states will vote on recreational legalization this November, including Arizona, Massachusetts, and most importantly, California.
According to Bloomberg, a new report from ten financial analysts at Cowen & Co. states that if the California measure passes, the legal marijuana industry will grow to $18 billion, or three times its current size.
The analysts believe that the overwhelmingly positive outcomes of this decision in such a large state will play a huge role in convincing the federal government to legalize marijuana nationwide in a matter of years.
They also suggested that Congress will have no choice but to yield to the increasing nationwide support for federal legalization.
Previous research has shown that more than 50 percent of the country currently supports federal legalization and just one-third of the country views regular marijuana as risky.
Data released last month revealed that in just three years, the amount of adult marijuana users in the US grew from 7 percent to 13 percent.
Federal legalization will allow the industry to expand so significantly that in ten years, it will be valued at $50 billion.
The analysts said the likelihood of any industry experiencing such tremendous growth is extremely rare.
“A 24 percent, 10-year revenue compound annual growth rate is hard to find in consumer staples, in particular one with a $50-plus billion end-point.”
Big Tobacco will enter the industry once large companies can no longer be penalized for working with legal marijuana businesses, the analysts predicted.
Manufacturers of tobacco vaporizers will then begin making similar products for cannabis, while tobacco cultivators will apply their high-tech agricultural techniques to cannabis production.
By 2036, the analysts said, Big Tobacco will account for one-fifth of the legal marijuana industry and experience a 20 percent increase in revenue.
The move will be vital for tobacco companies since cigarette use among Americans aged 12 and older has fallen over the past twelve years.
Last week, it was reported that teen cigarette use decreased by two-thirds nationwide in the same time period.
Source: Best Buds