The View

A drink, sir? And a spliff to go with it?

Legal US market for cannabis now reckoned to be worth US$6bn annually, but expected to rise nine fold to $50bn by 2026

PUBLISHED : Wednesday, 30 November, 2016, 12:44pm
UPDATED : Wednesday, 30 November, 2016, 10:36pm

Some high times have emerged following the recent polls in the United States and I’m not talking about the feeling of intoxication surging through the veins of those who feel it is once again safe to say really crude things about race or sex or about minorities, not forgetting the half of the population that country is not male.

I’m talking about the decision of citizens in California, Maine Massachusetts and Nevada who, while choosing the next president, also voted to legalise the sale of marijuana.

As a result around half of America’s population will have access to legitimate supplies of the weed when taking account of existing laws in other states that allow the sale of marijuana for recreational or medical use.

Opinion polls show that support for legislation is strong elsewhere so it is only a matter of time before smartly designed packs of marijuana will be on shop shelves all over the place.

The legal US market for cannabis is now reckoned to be worth a not-so-modest US$6 billion per year, but this is expected to rise nine fold to $50 billion by 2026, according to the market research group Cowen.

No wonder the big corporates are getting interested, not least among them are alcohol sellers who fear that the rise of the weed will take a toll on their drinks business.

Drinks group Constellation Brands is already thinking about flavouring its beverages with marijuana, the massive brewing conglomerate Molson Coors says that “cannabis is something we are thinking about very carefully”. Stand by for a lot more of this thinking.

Even Hong Kong will eventually get round to re-thinking its legislation at some time in the rather distant future because amending laws to match social change is something that is heavily resisted by the dinosaurs who run the local bureaucracy. Yet, of course, cannabis will continue to be traded here although rather more dangerous and unstable drugs appear to have a bigger market.

And here’s the rub because drugs, like other alleged ‘social evils’, do not go away because they are illegal, indeed in the case of intoxicants, their very illegality adds to their allure.

In the United States and many other parts of the industrialised world politicians have been forced to confront this truth and have decided that legalising products is not a matter of endorsing them but a pragmatic response to public demand.

Cannabis is something we are thinking about very carefully
Statement from brewer Molson Coors

Americans are probably more aware of this than others because even the least informed dimwit will know that when alcohol sales were banned in the USA, the biggest beneficiaries were criminal gangs who stepped in to cater for those wanting a drink or several.

Fast forward to today and there are still busy-bodies campaigning to ban the sales of alcohol, tobacco, fatty foods and goodness knows what else.

No one, well practically no one, pretends that any of this stuff is really good for you, even though the medicinal qualities of a fine wine are not be sniffed at, but in life many of the things that are not good for you remain pretty darn enjoyable.

Moreover these enjoyable things have spawned massive industries, employing millions of people and adding to those shinny gross national product numbers. Shutting them down mainly produces new underground non-tax paying industries that inevitably attract the interest of criminal gangs.

Yet governments cannot legalise products without regard to health risks; in the case of cannabis evidence for the dangers of its use have been long debated but the bulk of the research shows that marijuana is not significantly more harmful than a host of other ‘bad’ things.

Indeed it has proven medical benefits and, yes, when taken to excess, can be very nasty but this also applies to over-dosing on cream cakes.

What is fascinating about moves to legalise cannabis is how big corporations will make the transition into selling these once banned products. It’s not the same as resuming the legal alcohol trade because many companies knew exactly how to do that.

Marijuana legalisation breaks new ground while providing a massive business opportunity. The pace at which the industry develops is not clear but my guess is that it will be pretty rapid and, inevitably there will be some backlash. So it will be interesting to see which major companies are prepared to take the plunge first and how doing so will affect their other brands and reputation.

First movers do not always reap the benefits in these circumstances but finding a way of being among the early movers without being too far in front is a delicate business requiring quite a bit of thought maybe with the assistance of some heavy draws on the weed.