A state-by-state look at where marijuana is legal
Over the next decade, marijuana may well be one of the fastest growing industries in the United States. Tech stocks may be the toast of Wall Street this year, but “Marijuana Business Factbook 2020” by Daily Marijuana Business predicted that sales of cannabis through legal channels in the United States could triple between 2019 and 2024 to reach $ 37 billion.
Such rapid growth in sales has been made possible by a sea change in the way the American public perceives cannabis. National pollster Gallup found that only about a third of the country was in favor of legalization in the mid-2000s. But in 2018 and 2019, support for national legalization of adult use reached an all-time high of 66%. As Americans softened their stance on cannabis, state-level legislation and elections allowed the green wave to take shape.
However, the legality of marijuana can vary wildly depending on where you live. With the 2020 election now in the books, here’s a full look at where the 50 states stand on marijuana.
Marijuana is fully legalized and retail sales continue
After the green sweep on election night, 15 states have now approved recreational and medical marijuana. But not all are currently selling the product. Currently, 10 states have waved the green flag on the sale and consumption of weed for adult use (listed in alphabetical order):
Despite the legalization of adult cannabis in November 2016, it took Maine until October 9, 2020 to officially launch recreational pot retail. Illinois also stands out as the first state to fully legalize the recreational use and sale of marijuana at the legislative level.
California is the most populous state in the country and the most valuable marijuana market in the United States (and the world). Although estimates vary, the Golden State could rake in up to $ 11 billion in annual sales by 2030.
Cannabis has been fully legalized, but retail sales have yet to begin
That leaves five states that have passed legislation or voted to legalize cannabis for adult use (in addition to medical use), but have yet to open retail outlets. These five states are:
- New Jersey
- South Dakota
If some of these names are familiar to you, it’s because voters in Arizona, Montana, New Jersey, and South Dakota all approved measures relating to recreational cannabis in their respective states in the 2020 election. Measures in New Jersey and Arizona were passed by a landslide, while votes in Montana and South Dakota were a bit tighter. South Dakota is particularly remarkable because it is the first state to go from completely illegal to legal recreational in a single election.
As for Vermont, its state legislature legalized the consumption of recreational pot in January 2018 but not the retail sale of the product. In October 2020, the Vermont state legislature passed a bill legalizing its retail sale. However, dispensary licenses can only be issued in October 2022, so it may still be up to two years before sales of weed for adult use begin.
Medical marijuana is legalized, but weed for adult use is illegal
After the 15 states that have legalized both recreational and medical cannabis, another 21 states have waved the green flag solely on medical marijuana. In alphabetical order, these states are:
- New Hampshire
- New Mexico
- new York
- North Dakota
- Rhode Island
- West Virginia
Although it is traditionally one of the most conservative states in the country, Mississippi measurement of the vote on medical cannabis passed in a landslide in the 2020 elections.
For some states, such as Florida, medical marijuana is big business. But medical sales are often cannibalized once weed for adult use is legalized. According to Ballotpedia, five medically legal states are already preparing recreational cannabis voting measures for the November 2022 election: Arkansas, Florida, North Dakota, Oklahoma and Mississippi.
Recreational and medical marijuana is illegal
Finally, there are 14 states where cannabis is illegal … period! These states are:
- North Carolina
- Caroline from the south
The dominant theme here is these are states mostly led by Republican lawmakers. Polls have shown that while Democrats and Independents are overwhelmingly in favor of nationally legalizing cannabis, Republicans are not as enthusiastic. Most polls (including Gallup) show support for weed for adult use around the 50% mark for Republicans, with a markedly higher preference for medical cannabis.
The big picture remains bright for cannabis stocks
It’s been 24 years since California became the first state to accept medical cannabis, and since then 35 more states have legalized weed in some capacity. The map of the United States is turning green at a remarkably sustained rate without the help of the federal government, and marijuana stocks are going to be the big beneficiary.
Although cannabis stocks have suffered somewhat over the past 19 months, vertically integrated multistate operators like Green thumb industries (OTC: GTBIF) and Trulieve Cannabis (OTC: TCNNF) gave people a glimpse of what’s possible on the investment side of the equation. Green Thumb has opened about four dozen dispensaries across the country but has enough licenses in its back pocket to doubling its commercial presence to 96 stores. Meanwhile, Trulieve Cannabis has opened more than five dozen dispensaries in Florida alone and is currently the the most profitable pot stock in North America.
The green rush is well underway. The only question is, will you participate?
This article represents the opinion of the author, who may disagree with the “official” recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.