Cannabis data and analytics company, Headset, announced the launch of a report highlighting a long-term forecast into the U.S. and Canadian cannabis markets! Specifically, forecasting the sales, sales volume, and market shares for 2021 and 2022 compared to 2020.
The cannabis industry during 2020
The cannabis industry held their breath last year when COVID-19 hit. We fully expected to see a dramatic impact on businesses, and at our worst: expected to get shut down and deemed non-essential. For the most part, that didn’t happen and many local governments declared cannabis businesses to be essential. We collectively breathed a sigh of relief, but many physical storefronts were damaged in some of the riots over the summer, forcing some stores to close briefly. Despite that, the industry trudged forward and kept it moving, seeing the end of 2020 and welcoming a hopefully very different 2021.
Headset’s methodology for this report
Headset says: “These forecasts will include all 13 Canadian provinces and territories and 36 US states* with any level of legalization and across all markets (recreational and medical), and the data will be presented in the aggregate for each calendar year. Typically, Headset only forecasts one forward looking month at a time and in this new framework, forward looking forecasts will cover at minimum five quarters (15 months) and at maximum eight quarters (24 months).” The numbers take New Jersey, New Mexico, and New York’s new legalization into account.
The data estimates the U.S. cannabis market to reach $23 billion in sales by 2022. Canada’s market is expected to grow twice as fast as the American market from 2020 to 2021, and nearly three times faster from 2021 to 2022. Headset predicts Canada’s annual sales to grow 54.6% in 2021 and 31.9% in 2022. The United States is predicted to see a 23% growth rate in 2021 and 24.4% growth in 2022. Canada’s cannabis market is expected to hit $4 billion in sales in 2022, so significantly lower than the U.S. market, but nonetheless on an incredibly fast-paced rate of growth. Check out the predicted (and last year’s) sales volume in both countries:
U.S.: $18,504 million
Canada: $2,624 million
U.S.: $22,751 million
Canada: $4,057 million
U.S.: $28,308 million
Per usual, flower is expected to dominate future markets and did dominate 2020’s market.
- Flower accounts for a majority of total annual sales, reaching $11 billion and $12 billion in 2021 and 2022 respectively.
- Despite flower’s consistent popularity in both markets, edibles, vapor pens, and concentrates hold more market shares than flower in 2020, 2021, and 2022
- Edibles and concentrates are expected to have larger market shares (at the expense of flower and pre-rolls) in 2022
- Pre-roll sales are expected to contribute to 20% of Canada’s total sales volume growth in 2022, making for a 2% increase from the prior year
Tinctures, topicals, capsules, and beverages are consistently among the categories with the lowest sales in both markets, but still accumulating millions of dollars each year and in some cases, sharply rising.
Category shares for both markets
The report also goes into detail about market shares by category, specifically sales and sales volume. Here are the top performing categories (roughly) in order, it changes depending on country and the year, but all five are consistently at the top:
- Vape Pens
Download Headset’s report here.