- US Cannabis stocks up 50% for the year
- Slight fall in recent days after profits did not rise as quickly as expected
- 10 states have legal recreational Cannabis, with 23 more allowing for some degree of medical marijuana
2018 was a meteoric year of expansion for the budding US cannabis sector, with over 64,000 new jobs created, and recent reports see no signs of that growth slowing down.
On the federal level cannabis is still outlawed, classified along with heroin and cocaine as one of the most deadly and medically useless drugs in the world. However, the scheduling system, and the positions of the various banned substances on it are political. To date there have been zero deaths due to marijuana overdoses, and no known cases of physical addiction.
On a state level recreational marijuana use is legal in ten states, as well as Washington DC. Although it remains banned federally and the US Bureau of Labor Statistics does not keep track of the sector, state data shows a booming industry, with 64,000 new full time jobs created last year, beating out solar energy installation and healthcare for fastest growing job sector.
Room for growth
Although Cannabis in 2019 has to contend with a slowdown in hiring nationally, it looks set outperform other sectors this year as well. Beyond the immediate horizon, marijuana remain completely banned in 17 states, and only medical use is allowed in another 23. With recreational use already legalized in Canada, and courts having de facto legalized the possession of small amounts for personal use in Mexico, it is very strongly looking like the rest of the US will follow suit eventually, opening up even larger markets for the companies that are already booming.
Some obstacles to growth remain – banking is often a difficulty for businesses that sell cannabis products. This is because, as the plant remains illegal on a federal level, banks face potential penalties for serving customers that make money off the sale of illegal products. A bi-partisan bill is currently in committee that would protect banks serving these businesses, but until that bill is out of committee and passed banking services will be difficult to secure for this otherwise thriving sector.
The Cannabis sector is up 50% for the year on the stock market, however the last few days have seen a small slump in prices after lower than expected profits. As a speculative, young market, this is not overly concerning to anyone in the field, however it does show that while the Cannabis sector is steadily climbing higher and higher, it still has a long distance to catch up when compared to alcohol.