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The Cannabis Industry is Blazing on Economic Upsides

Investors are flooding into the industry in areas where it has been legalized.

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By Jackson Parker | USA

With the changing culture turning to allow cannabis for medical and recreational use across the world comes with some serious opportunities for those involved. Many places have decriminalized the plant for use among citizens. With states like Colorado, California and Massachusetts as well as countries like the Netherlands, Columbia, and soon to be Canada have started putting in place a system of legal consumption of the plant.

The legalization of the plant for recreational purposes has created enormous economic opportunities for the early adopters of the policy. Legal cannabis has accounted for 2.96 billion dollars so far in 2017.  With Colorado alone peaking over 1 billion dollars in cannabis sales in only the first eight months of 2017. With the plant’s massive success rate comprised of around 30% medical and 70%, recreational use investors are seeking the profitability associated with the newfound industry.

“While the medical market is expected to continue to grow over the next several years, the size of the coming adult-use market is expected to far exceed that of the medical side,” states the company of Viridian Capital Advisors, who closely analyzes the cannabis market and provide data on cannabis stock prices, and legislative progress. “Companies have been raising significant amounts of capital, primarily to increase capacity to satisfy the coming surge in expected demand.”

Canada has recently put a plan into action to move towards the legalization of recreational marijuana with bills to hit the floor in January 2018. With the medical use already legalized the profits involved with the full scale legalization in Canada have attracted many investors. Included within the investments made include 1.5 billion dollars into Canadian companies. One of the largest investments is from Constellation Brands, the proprietor of Corona beer, with an almost quarter billion dollar investment into Canopy Growth Corp.

“We expect to see larger, more successful companies beginning to raise additional capital to further expand their capacities and footprints,” states Harrison Phillips, the vice president of Viridian Capital Advisors, “we expect to see an acceleration in consolidation as operators seek economies of scale and synergies to remain competitive as the continued commoditization of cannabis reduces prices and margins.”

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