Pubdate: Thu, 25 Aug 2016
Source: Sacramento Bee (CA)
Copyright: 2016 The Sacramento Bee
Author: Peter Hecht


Two groups studying the cannabis economy say legalizing recreational 
marijuana in California will provide a $1.6 billion boost in revenue 
from expanded retail marijuana sales.

The projections on California's Proposition 64 legalization measure 
in November come from two firms with a vested interest in expanding 
the marijuana business. The market study was completed by New 
Frontier Data, a Washington, D.C., firm conducting cannabis market 
research, and the ArcView Group, an Oakland organization specializing 
in attracting investment for marijuana businesses and legalization causes.

Earlier this year, New Frontier and ArcView Market Research 
collaborated on a report, The State of Legal Marijuana Markets, that 
valued at $2.7 billion California's existing medical marijuana market 
of retail cannabis dispensaries, marijuana, food processing kitchens, 
laboratories and other businesses in 2015. By comparison, the state 
Board of Equalization in 2010 estimated marijuana dispensary revenue 
at up to $1.3 billion based on estimated state sales taxes.

Now the cannabis research firms' 2016 California Legal Cannabis 
Market State Profile says legalizing marijuana for adult social use 
would grow California's marijuana market by 18.5 percent a year once 
dispensaries are fully operational selling marijuana products to both 
medical and nonmedical users, likely in 2018. The cannabis industry 
research firms say the California market then would grow to $6.46 
billion by 2020.

The report, on sale for $249, and its executive summary, free for 
download, offer other interesting conclusions about the state of 
marijuana in the Golden State.

The report suggests that California will require 1,500 to 2,200 acres 
of cultivation to satisfy marijuana consumer demand. At the same 
time, it says the market is likely already over-saturated with pot 
produced for the current medical marijuana market as well as illicit 
sales in the black market in the state and beyond. The research 
underscores the likelihood that the out-of-state black market for 
California pot will continue to thrive in ensuing years even if 
voters pass Proposition 64.

Citing national drug survey data, the report also says marijuana use 
in California is highest in San Francisco and far Northern California 
counties, with the rate of personal pot use jumping in Mendocino, 
Lake, Colusa, Butte, Plumas and Lassen counties. Sacramento Bee 
research, tracking federal estimates for annual marijuana use, found 
that high weed use also occurred in counties encircling the capital city.
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MAP posted-by: Jay Bergstrom