The cannabis industry is poised for explosive growth, with total retail sales expected to reach a staggering $32 billion by 2024, according to Beau Whitney, founder and chief economist at Whitney Economics. This figure could potentially double in the coming years, making the cannabis market a lucrative investment opportunity.
Whitney, who presented his findings at the recent Benzinga Cannabis Capital Conference in Chicago, emphasized the crucial role of legal consumer participation and the number of licenses issued in different states in driving this growth. He highlighted that some states are already saturated with licenses, posing a challenge for new entrants. However, there are states, like Texas, with significant untapped potential, attracting early investors who are preparing for potential legislative changes.
Despite the promising forecast, Whitney also highlighted the industry’s challenges. The significant amount of delinquent accounts receivables, exceeding $3.8 billion at the end of 2023, reveals the financial struggles faced by many cannabis operators, particularly in cultivation.
Whitney’s report, co-authored with CTrust and Green Check, outlines a potential midpoint of $48 billion in new cannabis investment by 2028, with this figure reaching $78 billion by 2035. However, he stressed the importance of careful due diligence, as market dynamics and local regulations vary significantly.
Whitney identified California as a prime market for retail and product manufacturing investments, while cultivation opportunities are becoming scarce due to market saturation. Investors, he advises, must thoroughly understand local regulations and market dynamics to make informed decisions.
The report’s complete findings will be publicly released soon, with an executive summary expected to be available next week. This detailed analysis offers valuable insights for both seasoned investors and newcomers seeking to capitalize on the burgeoning cannabis market.
