Right now, medical marijuana is legal in 33 states in the US and Washington, D.C. Recreational marijuana is legal in 11 states and Washington, D.C. However, the number of states legalizing recreational marijuana will most likely change in 2020. Florida is one of the few states that may aggressively push for recreational marijuana legalization next year.
Marijuana legalization will create jobs in Florida
According to Leafly and Whitney Economics, the legal cannabis market had created 211,000 jobs in the US as of March 2019. The report estimates that the YoY (year-over-year) rises in the cannabis workforce were 21% and 44%, respectively, in 2017 and 2018. Leafly also expects a 20% YoY rise in cannabis-related jobs in the US in 2019.
According to Leafly and Whitney Economics, Florida added 9,000 full-time cannabis-related jobs in 2018. Total cannabis-related employment in the state rose 703% YoY in 2018. The report estimates the addition of more than 5,000 cannabis-related jobs in Florida in 2019. This will increase the number of people employed in cannabis-related jobs in Florida to 15,000.
On October 18, the Miami New Times reported some encouraging figures from New Frontier Data’s recently published U.S. Cannabis Report: 2019 Industry Outlook. According to this report, marijuana legalization in Florida will increase the total number of cannabis-related jobs in the state from 16,792 in 2019 to 128,587 by 2025. This estimate implies more than a sevenfold increase in the available job pool.
Marijuana legalization and Florida’s economy
Besides employment, marijuana legalization is expected to result in several other benefits for Florida. Marijuana legalization will help increase tax revenue for Florida. Increasing employment will also translate into higher overall consumer spending. More importantly, it will lead to an increased percentage of people covered by employer-sponsored health insurance.
Medical marijuana may help control opioid abuse in Florida. The legalization of adult-use marijuana may also help the state in recessionary times. Although cannabis isn’t a recession-proof industry, it may prove more resilient to economic downturns than other consumer-focused industries.
Now, let’s see how Florida’s legal marijuana market is positioned to reap these benefits.
Florida’s marijuana market opportunity
In an updated report called The State of Legal Marijuana Markets: 6th Edition, Arcview Market Research and BDS Analytics estimate that the value of the legal cannabis market in the US will reach $15.8 billion by 2020. The research companies also expect the US legal cannabis market to be worth $19.1 billion and $22.2 billion, respectively, in 2021 and 2022.
New Frontier’s industry outlook report estimates that the value of the legal cannabis market in the US will reach $29.7 billion by 2025. Florida could account for almost 12% of the total legal cannabis market in the US.
Medical market opportunity
Florida legalized medical marijuana through a constitutional amendment on November 8, 2016. A total of 71.32% of voters supported the Florida Medical Marijuana Legalization Initiative, also known as “Amendment 2.” The amendment has been in effect since January 3, 2017. Following this legalization, medical marijuana containing any amount of THC (tetrahydrocannabinol) became available to qualified patients as of July 3, 2017.
Medical marijuana legalization in Florida has proved to be a commercial success. According to the Arcview Market Research and BDS Analytics report, the medical marijuana market in Florida may grow to $1.62 billion by 2022. In 2018, the state reported legal cannabis sales of $626.4 million. iAnthus Capital’s investor presentation expects the value of Florida’s medical marijuana market to reach $1.0 billion by 2020.
Marijuana Business Daily also tagged Florida as the second-fastest-growing medical marijuana market, with the fastest-growing market being Oklahoma. The newsletter has estimated the average daily growth in the number of patients in Florida to be 609. According to Marijuana Business Daily, registered marijuana patients in Florida account for around 1.6% of the state’s population.
On October 11, the Department of Health’s Office of Medical Marijuana Use reported the number of medical marijuana patients in Florida as 379,989. Of these, 274,578 were qualified patients with active identification cards. The state also had 2,535 qualified physicians allowed to prescribe medical marijuana. In October 2018, there were only 179,027 total patients and 137,470 qualified patients in Florida. The number of qualified physicians was also significantly lower at close to 1,787.
Florida’s recreational marijuana market
Florida is now gearing up to legalize adult-use marijuana by 2020. The chances of legalization seem high, considering the amount of money that’s been invested in the petition-gathering process.
Currently, three initiatives with different versions of recreational marijuana legalization are seeking signatures in Florida. They are Make It Legal Florida, Regulate Florida, and Floridians for Freedom. To secure a place on the November 2020 ballot, each initiative will require at least 76,632 signatures. Make It Legal has already secured more than 100,000 signatures. Regulate Florida collected more than 89,000 signatures in September alone.
Although Regulate Florida was the first initiative launched in the state, Make It Legal Florida seems to have the highest chance of becoming law. Make It Legal has managed to raise $1.6 million, while Regulate Florida has raised $199,000 to date. In September alone, Make It Legal Florida raised $535,000, while Regulate Florida raised $21,000.
Make It Legal initiative
According to the Florida Phoenix, two prominent cannabis players, Surterra Wellness and MedMen (MMEN) (MMNFF), have been putting their financial muscle behind the Make It Legal Florida initiative. This version of adult-use marijuana legalization seems to best suit the corporate players. The initiative would allow for the personal use and transportation of up to 2.5 ounces of marijuana for all adults over 21 years old. However, it requires the sale of marijuana to be restricted to only state-approved medical dispensaries. The initiative also categorically bans the advertising of marijuana to kids.
Some marijuana activists in Florida, however, are criticizing this initiative. They claim that Make It Legal Florida will create a virtual oligopoly in the state’s cannabis market. There’s some truth to this claim, considering that the business is currently concentrated in the hands of 22 vertically integrated licenses in Florida.
Leading cannabis players in Florida
According to the Office of Medical Marijuana Use, Trulieve has the highest number of dispensing locations in the state at around 37. Surterra Wellness and Curaleaf (CURA) (CURLF) account for 34 and 26 dispensing locations, respectively. Curaleaf has been aggressively increasing its number of dispensaries as well as its product portfolio in Florida. MedMen currently has only five dispensing locations in the state. However, it plans to expand this number to 12 by the end of 2019.