Californians get optimistic to make billions in recreational marijuana

Posted by Sagar Satapathy on July 05, 2016.

As California is set to vote on recreational marijuana legalization during November ballot, there is high enthusiasm and expectations over the money making in marijuana market. With a population of nearly 40 million people, and legalization of medical marijuana 20 years ago, the state has already become United States’ largest legal marijuana market.

The legal medical marijuana market in the United States totaled about $5.7 billion in 2015, California was the market leader with a 47 percent market share on $2.7 billion in sales. Legalization of recreational marijuana in the state could reach $6.6 billion marijuana market in the country by 2018, according to the “State of Legal Marijuana Markets” report. It would generate an estimated $1 billion in additional taxes per year.

According to Deputy Director Taylor West, the number of Californian companies in the National Cannabis Industry Association has grown to 330. As many as 115 new Californian companies have joined the association since January 2016. New companies include cultivators, laboratories, dispensaries, law partnerships, software developers, accountants, insurers and more.

Interestingly, Politician Daniel Conway left a lucrative job as chief of staff to Sacramento’s Mayor Kevin Johnson to start a marijuana investment company. He is optimistic about the $4 billion marijuana market.

Newport Beach-based Terra Tech is trying to prepare for recreational sales while building a legal business within the state’s medical marijuana marketplace, which has annual sales of $2.7 billion. The company spent more than $800,000 designing and remodeling its Oakland dispensary to look more like a high-end lounge than a drab medical clinic, said CEO Derek Peterson.

However, the passage of the California measure on recreational marijuana is still uncertain. It is opposed by many of the same law enforcement and health care groups who helped defeat the 2010 initiative.

If the California marijuana legalization vote succeeds, then the recreational use of marijuana will allow adults aged 21 and above to keep at least one ounce of marijuana and cultivate six plants in accordance with the rules on commercial cultivation, manufacture, and sale.

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