The cannabis industry may soon outdo one of the largest food and beverage markets in the world — the soda market.
Fewer people are craving the sugary, carbonated drinks. At the same time, the legal weed industry is picking up financial steam.
A research team from the financial services firm Cowen predicts the legalized cannabis industry to generate $75 billion in sales by 2030.
That’s about the size of the current soda market in North America. Unfortunately for soda companies, people are choosing healthier drink options.
Soda Sales Are Falling
It’s safe to assume that consumers aren’t straight-up trading soda for weed. But the threat of substitution is very real for the alcohol industry.
Trading Alcohol For Weed
The Cowen analysts say the rate of binge drinking is down in states where marijuana is legally available. In those states, binge drinking is 9 percent lower than the national average.
“This work builds on our prior assertions that cannabis acts as a substitute social lubricant for consumers,” the analysts say in their newest report, indicating that alcohol sales could be jeopardized as more states legalize the drug.
Vivien Azer studies the alcohol and cannabis markets for Cowen.
In a note to investors in 2017, she said the trend is driven by young people’s changing views on both marijuana use and drinking.
“Increasingly, young people view alcohol as more risky, and they view cannabis as much less risky,” she said.
The alcohol market is certainly not going bankrupt anytime soon. Alcohol sales hit $210 billion in 2017.
The Cowen team estimates the cannabis market is already $50 billion in size with 33 million estimate users.
Nine states have legalized recreational and medical marijuana representing a quarter of the U.S. population.
Marijuana Linked To Fewer Opioid Problems
Another interesting side effect of the marijuana industry, specifically medical marijuana, is that it can help people struggling with opioid addictions.
Experts have proposed using medical marijuana to help Americans struggling with opioid addiction. Now, two studies suggest that there is merit to that strategy.
Two studies published in the journal JAMA Internal Medicine looked at states that have legalized medical marijuana compared to states that have not. They compared opioid prescription patterns in the two types of states.
Scientists found that states with legalized medical marijuana had 2.21 million fewer daily doses of opioids prescribed than states where medical marijuana was not legalized.
“This study adds one more brick in the wall in the argument that cannabis clearly has medical applications,” David Bradford, professor of public administration and policy at the University of Georgia, told CNN. “And for pain patients in particular, our work adds to the argument that cannabis can be effective.”