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The Story of Cannabis: What Investors Need to Know

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The Story of Cannabis: What Investors Need to KnowAnatomy of a Cannabis PlantA Quality Cannabis ProductThe Rise of OrganicBalancing the Environmental Costs of CannabisComing soonComing soonComing soon

The Story of Cannabis: What Investors Need to Know

The Story of Cannabis: What Investors Need to Know

It’s not often that a multi-billion dollar industry appears out of nowhere.

Despite the fact that the first-recorded cannabis use by humans was from as far back as 6,000 years ago, the emerging cannabis market remains a challenging enigma for most investors to wrap their heads around. The opportunity is there, but there are few precedents for companies pioneering in the space.

What will users look for in a legal cannabis product, and how can investors and companies prepare to make the most of this Wild West of a market?

What Investors Need to Know

Today’s infographic comes to us from The Green Organic Dutchman, and it serves as an introduction to the story of cannabis, providing context around the plant, its history, market trends, and the potential of emerging legal markets.

It’s the first part in an eight-part infographic series called “From Soil to Sale”, that will dive deeper into these trends and what they mean to investors.

The Bird’s Eye View

Cannabis has a 6,000 year history of human use – however, since becoming illegal in the early 20th century, it’s fair to say the knowledge gap has broadened as to the plant’s uses and potential.

A Quick Overview:
The female cannabis plant produces clusters of buds which are trimmed down for commercial use. Trichomes are small “hairs” on the outside of cannabis flower that produce and secrete resin, including the cannabinoids and terpenes sought after by users.

There are over 750 compounds found in the plant, including at least 104 cannabinoids.

THC is the cannabinoid you are likely most familiar with (it’s the psychoactive one), but another cannabinoid that is being intensely studied is CBD – a non-psychoactive medicine that has wide applications to several diseases.

Key Industry Trends

As the legal industry takes off, here are three consumer-focused trends to keep in mind as you watch the cannabis sector:

1. Environmental Sustainability
Indoor cultivation of cannabis is both energy and carbon intensive, while outdoor cultivation uses massive amounts of water. With these potential impacts in mind, consumers will demand cannabis products that minimize effects on the environment.

2. Organic Products
More consumers are leaning organic. The global organic market is expected to blossom into a $320.5 billion market by 2025 – and organic cannabis will likely see similar uptake.

3. Cannabis Retail Products
The market for cannabis-infused food and beverages is expected to grow at a 25% CAGR between 2018 and 2022.

In large legal markets like California and Canada, there is a multi-billion dollar opportunity for investors and companies in the cannabis space – and we will continue to demystify the legal cannabis market and how it works as we continue through this infographic series.

This is part one of an eight-part series. Stay tuned by subscribing to Visual Capitalist for free, as we go into the cannabis market in more depth.

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Cannabis

Mapped: Countries Where Recreational Cannabis is Legal

In total, only nine countries have fully legalized recreational cannabis use.

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This map shows the countries where recreational cannabis use is allowed as of April 2024.

Countries Where Recreational Cannabis is Legal

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

In 2024, Germany became the third European Union country to legalize cannabis for personal use, following Malta and Luxembourg.

Here, we map the countries where recreational cannabis use is allowed as of April 2024, based on data from Wikipedia.

Limited to Few Countries

In total, only nine countries have legalized recreational cannabis use nationwide. However, just a few of them have licensed sales.

CountryEffective dateLicensed sales since
🇺🇾 UruguayDecember 2013July 2017
🇬🇪 Georgia30 July 2018Never authorized
🇿🇦 South Africa18 September 2018Never authorized
🇨🇦 Canada17 October 201817 October 2018
🇲🇽 Mexico28 June 2021Never authorized
🇲🇹 Malta14 December 2021Never authorized
🇹🇭 Thailand9 June 20229 June 2022
🇱🇺 Luxembourg21 July 2023Never authorized
🇩🇪 Germany1 April 2024Never authorized
🇺🇸 U.S.Varies by stateVaries by state
🇦🇺 AustraliaVaries by jurisdictionNever authorized

At the federal level, cannabis is still considered an illegal substance in the United States. That said, individual states do have the right to determine their laws around cannabis sales and usage. Currently, cannabis is allowed in 24 states, 3 territories, and the District of Columbia.

Interestingly, the oldest legal text concerning cannabis dates back to the 1600s—when the colony of Virginia required every farm to grow and produce hemp.

Since then, cannabis use was fairly widespread until the 1930s when the Marihuana Tax Act was enforced, prohibiting marijuana federally but still technically allowing for medical use.

Today, the U.S. cannabis market is a $30 billion business. By the end of the decade, that number is expected to be anywhere from $58 billion to as much as $72 billion.

Similar to the U.S., Australia does not allow the use at the national level, but cannabis can be used legally in the Australian Capital Territory, which includes the capital Canberra.

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