The much-awaited Cannabis Banking Bill was passed by the House Financial Services Committee on Mar 28, 2019. This opened up avenues for legal and effective financing for marijuana companies in the United States.
This year began with Illinois starting to sell recreational marijuana from Jan 2. After discussing the pros and cons of the recreational usage of cannabis, the Illinois House and Senate voted in favor of legalizing marijuana on May 31, 2019. With this, Illinois became the 10th state in the United States to legalize the adult use of CBD products.
Observers of the cannabis industry expect the momentum from 2019 to continue in 2020. However, after a banner year, many experts believe that marijuana may be headed for a dead-end in 2020. They believe that the Capitol Hill might want to avoid legalizing marijuana at the federal level at least till the end of this year owing to the presidential elections in November and President Trump’s impeachment trial.
However, it should be noted that the cannabis industry associations and businesses have kept the revolution for federal level legalization alive through their concerted lobbying.
According to OpenSecrets.org, The Cannabis Trade Federation spent $790,500 on marijuana lobbying in the period between January and September last year. This was up from $170,000 in 2018. Let’s find out what can be expected from the pot industry in 2020.
While Trump has maintained his stand on the opposition of federal legalization of marijuana, he has allowed the states to individually decide on legalizing marijuana.
A poll from the Pew Research Center reported that approximately 55% of the Republicans supported marijuana legalization. The poll also found out that opposition to decriminalizing marijuana also dropped to 32%. This is significant for the space because Republicans have historically been skeptical about drug policy reformations.
Furthermore, most of the Democratic presidential candidates, except Joe Biden, also support marijuana legalization. In fact, Bernie Sanders had earlier promised that the next president would take executive action to make marijuana federally legal. Analysts now expect that a bipartisan majority might finally approve the decriminalization of weed federally.
Reportedly, Missouri had submitted a proposal last year for recreational legalization of pot, which has been approved. The state, however, has made sure that labeling, advertising and packaging details would remain strict so that it does not appeal to the youth.
The proposal seeks to legalize possession and purchase of no more than one ounce of weed for citizens who are at least 21 years old. Further, the purchase would be allowed only from licensed retailers.
Furthermore, residents would also be allowed to grow up to three hemp plants for personal use. The state plans to charge a 15% excise tax on adult-use marijuana sales, expecting to generate $86–$155 million in revenues annually by 2025.
Increasing tolerance, financial protection, credit availability and legal votes have shaped America’s hemp industry lately. Such a development has more to do with growing awareness of its commercial and medicinal values. Establishment of stores, which sell recreational weed in the east coast, would go a long way in establishing a firm footing for the space.
Moreover, recreational legalization of pot is expected to be on the ballot in 2020 in states like Arizona, Arkansas, Missouri, Montana, New Jersey, North Dakota, Oklahoma and South Dakota.
Further, demand for novelty CBD products has been on the rise over the past few years. Cowen COWN estimates that the cannabis market in the United States will grow to $16 billion by 2025. Investors have a lot to look forward to America’s weed industry in 2020.
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