Recreational cannabis isn’t legal in Canada just yet, but it will be this coming summer, and a report released Tuesday by the Canadian Imperial Bank of Commerce (CIBC) predicts, that within two years, the cannabis marketplace will overtake the spirits industry in sales.
According to the report, the Canadians are projected to consume more than 1.7 million pounds of cannabis by the year 2020, and most of it will be recreational-use. Around 5 million Canadians bought marijuana last year, each consumer spending an average of $1,200.
“The bulk of the value generated from this industry will accrue to Canada’s provinces,” analysts wrote in the report. “In fact, we estimate that provinces will generate over $3 billion of income, either in the form of earned profits or taxation revenues.”
Currently, Canadians consume over 130,000 pounds of medicinal marijuana annually, but following the legalization of marijuana across the country, retail sales are expected to amount to nearly $6.5 billion.
Results of a study released earlier this year showed that Canadians spent $5.7 billion on marijuana in 2017, ninety-percent of it was non-medicinal.
In 2017, Canadians also spent $22 billion on alcohol, $16 billion on tobacco products, $9.2 billion on beer, and $5.1 billion on spirits. Statistics Canada data shows that marijuana use has grown about five percent annually in the country since the 1960s.