The past few years have been a roller coaster ride for legal cannabis in the United States. A Democrat-controlled White House and Congress, full of elected officials seemingly ready to end prohibition, have so far produced nothing on the federal level. A number of U.S. bills to support cannabis banking, expunge previous cannabis-related crimes, expand medical cannabis and even decriminalize the plant have all fallen flat.
The small island nation of Malta recently joined Canada and Uruguay as the world’s only nations to allow the sale and use of recreational cannabis, while Germany, Luxembourg, Italy and Mexico all look poised to potentially hop on the adult-use bandwagon at some point in the future.
In the U.S., the situation has proven to be more complex. Federal legalization doesn’t look likely any time soon, but cannabis on the state level is very much alive and well, with plenty of room to improve. Based on my experience in the industry, here are my top 12 predictions for what to expect in 2022:
1. U.S. federal legalization will likely not happen.
In fact, industry leaders can expect at least another five to 10 years before Uncle Sam embraces the plant, in my opinion. But it’s not all bad news. As corporate conglomerates continue to buy up cannabis brands in cannabis-legal states, smaller niche businesses can hold onto a bigger piece of the pie thanks to more exclusive markets.
2. More states could potentially pass adult-use.
Uncle Sam might not be ready to make cannabis federally legal, but momentum on the state level is something I’m sure we can expect. Among states with the best chances to approve adult-use this year include Ohio, where advocates are nearing the required 130,000 signatures to force the state legislature to discuss adult-use and put it on November’s ballot. In Arkansas, the campaign needs about 89,000 signatures to put retail cannabis up for a vote this fall; and in Missouri, 170,000 signatures are needed.
Florida’s Supreme Court blocked a pair of recreational petitions last summer, but advocates have put together a more legally sound initiative that could land on the ballot. All signs in Maryland also point to an adult-use initiative at the polls after a pair of prominent state legislators announced they were prioritizing legal cannabis for 2022. Advocates in Oklahoma have filed for a proposed constitutional amendment to legalize adult-use.
3. Brands will continue to merge, producing a small number of extremely large companies.
The big names in cannabis — Curaleaf, Trulieve, Aurora, Green Thumb, Tilray and Canopy — could likely get even bigger as more states pass adult-use and more small- and medium-sized businesses look to cash out.
4. Companies will continue to go public with IPOs.
IPOs will happen — to the extent possible, that is. Prohibition makes landing on the New York Stock Exchange or NASDAQ incredibly difficult for cannabis companies. Instead, look for more firms to go public via pink sheets and over-the-counter markets.
5. Retail giants like Amazon and Walmart likely won’t enter the industry.
Prohibition makes rolling the dice on cannabis a losing proposition for most U.S. retailers. The potential profits aren’t worth the extreme risk.
6. Established delivery platforms, like Uber and Lyft, will likely stay away from the plant.
Delivery platforms in the U.S. will likely avoid cannabis for the same reasons as big-box retailers. Uber has already started delivering the plant in Canada, but from my perspective, doing so in the U.S. before federal legalization would be incredibly precarious.
7. The emergence of craft brands will continue.
American adults have become more accustomed to legal cannabis and their taste for craft brands has also expanded. Similar to other categories of popular consumer products, consumer demand will likely produce markets far beyond cannabis mega-brands.
8. We’ll see more consistent and stable policies.
I believe we can expect more robust policies and regulations to develop, especially in more mature states where authorities have had time to figure out flower testing regulations, patient card requirements and cannabis DUI limits, among other tricky policies. The days of writing and amending weed laws on the fly should be a thing of the past in states like Washington, Oregon and Colorado.
9. The industry will become more ethnically diverse.
Almost every new and prospective cannabis state has social equity and diversity language included in its cannabis bills. Unlike before, when many earlier states adopted cannabis and focused on raising revenue, the latest states are also aiming to keep a level playing field.
10. More women will lead.
Plain and simple, the cannabis industry can’t reach its full potential without women owners and leaders. Why? First, organizations with greater representation of women in executive roles are more likely to outperform competitors. Second, women leaders have already established a track record of success in the industry, blazing a trail for the future. Trulieve CEO and co-founder Kim Rivers oversees the largest and most profitable cannabis company in the world and has long been praised for Trulieve’s success in retaining both employees and customers.
Women are needed at the top. From June 2020 to June 2021, Gen Z women were the fastest-growing customer demographic of legal cannabis users, with year-over-year sales to Gen Z women increasing by a whopping 151 percent.
11. Education will continue to be an industry trend.
I’m not just referring to the billions of cannabis tax dollars raised for public education. Consumers’ interest in learning more about the plant will prompt wider industry discussions on the impact of terpenes, cannabinoids and other properties.
12. More celebrities and public figures will venture into the industry.
It took a while for one-time cannabis skeptics, like comedian Jim Belushi and former U.S. Speaker John Boehner among a few dozen other celebrities, to put their names behind legal weed companies. But their success has blazed a trail for others to follow. Public acceptance of the plant will encourage more big names to cash in on the industry’s lucrative business opportunities.
Overall, 2022 could bring about some much-needed changes to the cannabis industry.