Possible Biden Win May Spur Cannabis Industry Growth
Companies with U.S. exposure are better positioned to benefit from easing prohibition.
The upcoming U.S. presidential election could lead to important regulatory changes that would grow the budding cannabis industry. Democratic presidential candidate Joe Biden and vice presidential candidate Kamala Harris have proposed decriminalizing cannabis. Although this would simply reduce incarceration for low-level possession crimes, it could signal the easing of federal prohibition. However, we continue to think that a change to U.S. federal law, removing prohibition and allowing states to choose their own cannabis legality, won’t come until at least 2023. Nevertheless, interim changes can reduce legal risk and ease access to banks and other ancillary services for the cannabis industry.
We think the U.S. market will prove to be the largest and will offer rapid growth. We forecast nearly 25% average annual growth for the U.S. recreational market and nearly 15% for the medical market through 2030.
Kristoffer Inton does not own shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.