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Green Rush: How Cannabis Legalization Will Impact California

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Across the United States, there’s a seemingly unstoppable movement gaining ground.

The legalization of cannabis for adult use – first passed in the states of Washington and Colorado in 2012 – is now approved in a total of nine states and the District of Columbia. By the end of the year, that total could be in the mid-teens as states vote on cannabis-related ballots in the upcoming mid-term elections.

California’s Green Rush

States are legalizing the adult use of cannabis for various reasons, but there’s no doubt that one of the primary ones is the potential impact on both the economy and government coffers.

Today’s infographic comes from cannabis royalty company FinCanna Capital, and it helps to contextualize the possible effects of cannabis legalization on the country’s largest state economy: California.

Green Rush: How Cannabis Legalization Will Impact California

Experts say the current cannabis market (including unregulated sales) in California is already worth about $8.5 billion, making cannabis quite the cash crop to start with. In fact, it’s an amount that’s bigger than the current three largest agricultural markets in the state: milk and cream ($6.1B), grapes ($5.6B), and almonds ($5.2B).

With the passing of Proposition 64 in November 2016 and legalization officially taking effect January 1, 2018, the state of California is now the world’s largest regulated cannabis market.

To take advantage of this growing opportunity, entrepreneurs are rushing to the Golden State from far and wide.

Sizing Up the Green Rush

In 2016, the regulated market for cannabis, which only included medical marijuana at the time, was worth $2.81 billion in California.

However, Arcview Market Research predicts that California will see regulated sales grow at a 23.1% annual pace between 2016-2020 as adult use sales come into play. By 2020, the total regulated industry will be worth $6.5 billion.

Meanwhile, it’s expected that the state government will be pocketing from the rush as well, picking up $1 billion or more per year from taxes. That includes a 15% levy on all cannabis sales, as well as cultivation taxes applied to buds and trimmings.

The Medical Component

As the largest legal market on the planet, California could see less expected green shoots, as well.

Because of its federal classification as a Schedule I substance, cannabis is extremely under-researched globally. With wider state acceptance of cannabis in California, it may be possible to foster an environment where more could be learned about the vast medical potential of the plant through the state’s powerful universities and institutions. This could lead to increased innovation, investment, and medical discoveries that could have an additional economic impact.

Such a track would follow in the footsteps of Israel, which is the world’s leader in marijuana research. In the country, there are 120 ongoing studies, $100 million in foreign and U.S. funds invested into patents, startups, and delivery devices, and ten-fold growth in investment expected between 2017-2019.

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Cannabis

Mapped: The European CBD Landscape in 2020

This graphic explains the innately complex legal status of CBD products in Europe and highlights the countries leading the CBD charge.

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Mapped: The European CBD Landscape in 2020

To say CBD has risen in popularity over the last decade is an understatement.

Not only have CBD consumer products rapidly infiltrated a long list of industries, new research discoveries continue to prove their therapeutic benefits. By 2023, the European CBD market is estimated to reach €1.4 billion.

However, a big problem remains—there is an incredible amount of uncertainty surrounding what is legal, and what isn’t. The above infographic from Elements of Green sheds some light on the innately complex legal status of CBD products in Europe.

The Great CBD Debate

CBD—short for cannabidiol—is a non-psychotropic compound produced by cannabis plants.

While most European countries have legalised it in some way, the caveat for many is that it must be extracted from industrial hemp, thus containing less than 0.2% THC—the intoxicating compound also found in cannabis. On the other hand, countries such as France and Norway only permit CBD isolate (the pure form of CBD) with no THC.

In 2019, the European Food Safety Authority (EFSA) designated CBD products as a novel food. This means that companies should seek authorisation to bring products to market, although it is not required by law.

However, the industry has now hit a fork in the road, as the European Commission (EC) recently announced it will be suspending applications for novel foods status while it determines whether or not certain CBD products should be labelled as narcotics instead.

The Legal Landscape in 2020

As the industry flip flops between regulations, consumers and investors need to understand that each country has its own laws surrounding the use of CBD.

CountryCBD Legal Staus
🇦🇱 AlbaniaIllegal
🇦🇩 AndorraIllegal
🇦🇲 ArmeniaIllegal
🇦🇹 AustriaLegal grey area (legal lean)
🇧🇾 BelarusIllegal
🇧🇦 Bosnia and HerzegovinaIllegal
🇧🇪 BelgiumLegal grey area (restricted lean)
🇧🇬 BulgariaUnrestricted
🇨🇿 Czech RepublicLegal grey area (legal lean)
🇭🇷 CroatiaLegal grey area (legal lean)
🇩🇰 DenmarkUnrestricted
🇪🇪 EstoniaLegal grey area (legal lean)
🇫🇮 FinlandLegal grey area (restricted lean)
🇫🇷 FranceUnrestricted
🇬🇪 GeorgiaIllegal
🇩🇪 GermanyUnrestricted
🇬🇷 GreeceUnrestricted
🇭🇺 HungaryLegal grey area (legal lean)
🇮🇸 IcelandLegal grey area (legal lean)
🇮🇪 IrelandLegal grey area (restricted lean)
🇮🇹 ItalyLegal grey area (restricted lean/legal for medical use)
🇱🇻 LatviaLegal grey area
🇱🇮LiechtensteinLegal grey area
🇱🇹 LithuaniaIllegal
🇱🇺 LuxembourgUnrestricted
🇲🇹 MaltaLegal grey area/legal for medical use
🇲🇩 MoldovaIllegal
🇲🇨 MonacoIllegal
🇲🇪 MontenegroIllegal
🇳🇱 NetherlandsUnrestricted
🇲🇰 North MacedoniaLegal for medical use
🇳🇴 NorwayLegal for medical use
🇵🇱 PolandUnrestricted
🇵🇹 PortugalLegal for medical use
🇷🇴 RomaniaUnrestricted
🇷🇸 SerbiaLegal grey area (restricted lean)
🇸🇰 SlovakiaIllegal
🇸🇮 SloveniaUnrestricted
🇪🇸 SpainUnrestricted
🇸🇪 SwedenUnrestricted
🇨🇭 SwitzerlandUnrestricted
🇺🇦 UkraineUnrestricted
🇬🇧 United KingdomUnrestricted

While a handful of European countries have made it illegal to import, buy, or possess CBD, the vast majority have legalised CBD products that either comply with the Novel Foods Act, or can be obtained from a licensed medical practitioner.

Of these countries, Germany and the UK lead the European CBD market, followed by Switzerland, Austria, Spain, and Greece.

A Call For Change

A progessive stance on cannabis legalisation combined with increasing consumer demand has led to several countries showing remarkable growth, such as Poland, Bulgaria, Netherlands, and Luxembourg.

Luxembourg in particular presents a compelling growth story, as it plans to fully legalise adult-use recreational cannabis in 2021, which would make it the first European country to do so.

Despite its small size, Luxembourg could in fact be instrumental in encouraging neighbouring countries to implement similar reforms, also known as the neighbour effect.

Growing Pains of a Nascent Industry

Considering each country has its own unique restrictions in place, CBD consumers should educate themselves on the regulations and laws relevant to them.

Despite these often confusing laws and restrictions, it is clear that demand for CBD products is growing exponentially. As a result, the continent may have the potential to overtake North America as the largest CBD market in the world.

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CBD Oil vs. Hemp Oil: What’s the Difference?

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CBD Oil vs. Hemp Oil: What’s the Difference?

For many consumers, cannabis plays a significant role in the treatment of medical conditions and managing general well-being. As a result, certain products have seen a rapid increase in popularity in recent years.

But while awareness of these products is at an all-time high, false or misleading information continues to cause confusion, and creates an unnecessary barrier for consumers who want to experiment with, or try different products.

For example, 69% of cannabidiol (CBD) products are reported to have inaccurate labeling, so it’s no surprise that some consumers are uncertain about the suitability of these products and are hesitant to invest.

Today’s graphic from Elements of Green dives into the differences between popular cannabis products, CBD oil and hemp seed oil—more commonly known as hemp oil— and the common misconceptions that are inhibiting consumers from entering the space en masse.

Same Plant, Difference Characteristics

Typically, both CBD oil and hemp oil originate from the hemp plant, a non-psychoactive cannabis plant. Therefore, it typically does not result in any intoxicating effects. However, many consumers mistakenly believe that CBD or hemp products will get them high, when in fact it is the marijuana plant—hemp’s psychoactive cousin—that can induce mind-altering effects.

Even though both oils are extracted from the same plant, they each have very different characteristics and uses that consumers should be aware of.

CBD Oil

CBD oil is extracted from the flowers, leaves, stems, and stalks of hemp plants, and contains high levels of the naturally occurring CBD compound. Various CBD oil formats include tinctures, vape oil, and capsules, which are commonly used for their proven therapeutic benefits, such as:

  • Pain management
  • Relaxation
  • Stress relief
  • Treatment of medical conditions such as epilepsy, schizophrenia, multiple sclerosis, and arthritis
  • Reduction in anxiety
  • Sleep aid

When it comes to product labeling, consumers should be aware that different types of CBD oils exist, depending on the chemical compounds—known as cannabinoids—they contain.

  • CBD Isolate: Pure CBD, with no other cannabinoids such as THC
  • Full-spectrum CBD oil: Contains CBD among other cannabinoids, including THC
  • Broad-spectrum CBD oil: Contains CBD among other cannabinoids, with no THC

These oils are used in a wide variety of consumer products such as beverages, beauty products, and even pet food.

Hemp Oil

Hemp oil, on the other hand, is extracted from hemp seeds and contains no cannabinoids such as CBD and THC. It is used more like a traditional cooking oil, but can also be found in topical creams and lotions.

More recently, hemp oil is being hailed for its use in industrial products such as concrete, bio-plastics and fuel. While it has huge potential for use in both consumer and industrial products, its benefits differ slightly to CBD oil:

  • Source of plant-based protein and rich in fatty acids and antioxidants
  • Reduces inflammation
  • Reduces severity of skin conditions such as acne, eczema, or psoriasis
  • Anti-bacterial properties
  • Could reduce PMS or menopause symptoms

Consumers should ensure that hemp oil is listed as the active ingredient on the product’s packaging, but it may also be listed as cannabis sativa seed oil.

Busting the Myths

While there is strong scientific evidence to support the efficacy of CBD oil and hemp oil, companies need to commit to both appropriate and safe labeling regarding dosage levels and ingredients.

Following that, previously held stigmas and misconceptions should slowly disintegrate as these products become more widely available and consumers increase their knowledge and understanding of their benefits.

Considering that the popularity of cannabis consumer products has only exploded over the last decade, initial confusion surrounding them is to be expected, and the true potential of these products is yet to be realised.

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