U.S. population growth and rising usage rates will naturally increase the nation’s total number of cannabis consumers.
However, with 34 existing legal medical states and 11 legal adult-use states, those programs are projected to capture some of the growing demand, and thus erode part of the growth in illicit markets nationwide.
In 2019, 17% of cannabis sales in the U.S. were estimated to be legal; New Frontier Data estimates that by 2025 more than one-third (34%) of total annual cannabis demand will be met through regulated markets.
When individual states impose strict market limitations limiting access or creating delays for cannabis, illicit markets tend to recapture consumers.
In California this year, but 38% of in-state demand will likely have been provided by legal regulated sources, though that share is projected to reach 46% by 2025.
Meantime, other recently activated recreational markets (e.g., Illinois, Massachusetts) are expected to convert nearly three-quarters of all cannabis sales to legal programs.
