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Hola Mexico! Recreational Cannabis likely to be legalized in the Country Soon

30 Oct Hola Mexico! Recreational Cannabis likely to be legalized in the Country Soon

The Global legal marijuana market is likely to reach over USD 66.3 billion by the end of 2025, as per a report by Grand View Research, Inc, growing at a CAGR of 23.9%. There is a growing acceptance of the curative effects of cannabis, with some countries such as Canada and certain states of U.S legalizing the use of Marijuana for medical and recreational use. Research has time and again shown that cannabinoids (CBD), extracted from the cannabis plant, have varied medical uses with minimal side effects, making it a sought after alternative to traditional pharmaceutical options.

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The U.S, where the use of cannabis has only been legalized in 33 states for medical use and 11 states for recreational use, is one of the largest untapped markets for Marijuana, with an estimated value of over USD 11.9 billion in 2018, which is likely to grow at a CAGR of 24.1% from 2019 to 2025.

Currently 33 states in the U.S along with Washington, D.C. have legalized medical marijuana while 10 states (plus D.C.) permit recreational cannabis. 2018 was a great year for CDB industry, not only was the Farm Bill passed that allowed for the sale of hemp and hemp-based cannabidiol products, but the FDA also approved its very first cannabis-derived drug Epidiolex for treatment of seizures.

The call for reform for legalizing marijuana at the federal level is gaining momentum with research proving time and again the many benefits of cannabinoids in treatment of various physical and neurological conditions. There is a growing acceptance of cannabis as pointed out by a survey by Gallup in October 2018, which saw two out of three adults now favor legalizing weed nationally

Mexico may soon become the third country in the world, after Uruguay and Canada, to legalize cannabis. On Oct. 17, 2019, the Mexican Senate Committee unveiled a draft legislation to legalize recreational marijuana. The bill comes in the wake of another legislation proposed last year by Interior Secretary Olga Sanchez Cordero. The Supreme Court of Mexico had earlier ruled that a ban on the recreational use and possession of cannabis was unconstitutional, and since it had delivered a similar verdict for the fifth time, according to tradition it has now become a standard, thereby legalizing marijuana at least in the eyes of the law.

Key Takeaways from the Legislation
The legislation is seeking to set the minimum age of purchase and possession at 18 years, which is different to the legal age in Canada and U.S that only allow only adults over the age of 21 years to buy or possess marijuana. Furthermore it stipulates that the consumption of recreational marijuana is restricted to private places, and has stringent guidelines governing the packaging of marijuana products such as use of nondescript packing, ban on use of either real people or fictional characters which may lure adolescents.

Medical Marijuana (OTCPINK: MJNA) ready been legalized in Mexico since 2017, and allows for only medical marijuana patients to purchase edibles and cannabis-infused beverages, which will continue even after the present legislation comes into effect. The government will constitute Cannabis Institute, a central agency, which will oversee the functioning of the marijuana industry by regulating potency limits, implementation of legislation and issuing cultivation licenses.

Putting the Economy First!
Another welcome move is that priority will be given to low-income individuals, small farmers, and local people in the award of licenses in order to benefit the economy and encourage competitiveness.

The Mexican cannabis industry presents a $1.02 billion opportunity, with recreational cannabis accounting for a total $582 million, with an additional $441 million in medical spending according to estimates by Arcview and BDS. A number of big ticket cannabis players have recognized this opportunity and have already made a foray into the Mexican market.

Marijuana companies such as Aurora Cannabis (NYSE: ACB), which acquired Farmacias Magistrales, its medical cannabis partner in Mexico and the only company which has the license to import, manufacture, store, and distribute medical cannabis that contains over 1% tetrahydrocannabinol (THC), are one of the early entrants into the Mexican market.  There are others who have either tied-up or acquired local players, in order to establish a presence in the market.

Good News for the Global Marijuana Industry
Medical marijuana was legalized by Canada in the year 2001, making it easier for about 330,758 Canadians including those suffering from cancer to get it through licensed producers. According to the 2017 Canadian Cannabis Survey (CCS), the medicinal and non-medicinal consumers of cannabis spent about $5.7 billion and recreational users spent close to $ 75 a month on marijuana and related products.

Research has time and again shown that cannabinoids (CBD) extracted from the cannabis plant has varied medical uses with minimal side effects making it a sought after alternative to traditional pharmaceutical options. All the counter-arguments that the critics of cannabis put forth have been proven unfounded in studies and research conducted by credible private and government-owned organizations.

The Global legal marijuana market is likely to reach over USD 66.3 billion by the end of 2025, as per a report by Grand View Research, Inc, growing at a CAGR of 23.9%. There is a growing acceptance of the curative effects of cannabis, with some countries such as Canada and certain states of U.S legalizing the use of Marijuana for medical and recreational use. Research has time and again shown that cannabinoids (CBD), extracted from the cannabis plant, have varied medical uses with minimal side effects, making it a sought after alternative to traditional pharmaceutical options.

Is U.S the next country in line?
The U.S, where the use of cannabis has only been legalized in 33 states for medical use and 11 states for recreational use, is one of the largest untapped markets for Marijuana, with an estimated value of over USD 11.9 billion in 2018, which is likely to grow at a CAGR of 24.1% from 2019 to 2025.

Currently 33 states in the U.S along with Washington, D.C. have legalized medical marijuana while 10 states (plus D.C.) permit recreational cannabis. 2018 was a great year for CDB industry, not only was the Farm Bill passed that allowed for the sale of hemp and hemp-based cannabidiol products, but the FDA also approved its very first cannabis-derived drug Epidiolex for treatment of seizures.

The call for reform for legalizing marijuana at the federal level is gaining momentum with research proving time and again the many benefits of cannabinoids in treatment of various physical and neurological conditions. There is a growing acceptance of cannabis as pointed out by a survey by Gallup in October 2018, which saw two out of three adults now favor legalizing weed nationally

These figures invite all sort of unscrupulous entities to make a killing by selling the produce illegally to adults and youth alike to make a fast buck. The move to legalize cannabis was partly to check the profits these unscrupulous elements make at the cost of public health.

Legalization of marijuana offers multi-fold advantages such as providing a safe access to quality products devoid of contamination at competitive prices, stringent laws to tackle violation of the legally accepted limits for purchase, possession and sharing and making it inaccessible to youth by ironclad laws that can attract hefty fines and imprisonment.

The legalization of cannabis in Canada and now Mexico, is the much-needed impetus that the industry here needed, and hopefully will make way for a pragmatic approach to how US deals with cannabis now.

The U.S House of Representatives passed a landmark legislation namely Secure And Fair Enforcement (SAFE) Banking Act (H.R 1595), which will provide access to banking and financial services to the cannabis industry , in spite of Marijuana still being a schedule A illegal substance under federal law.

However, with the increasing awareness about its benefits and the slow but steady efforts to get a regulatory framework and infrastructure in place, it may seem that the legalisation of cannabis may not be a distant dream anymore.

Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

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Source:

https://www.fool.com/investing/2019/09/08/5-countries-with-the-highest-cannabis-spending-by.aspx

https://www.fool.com/investing/2018/12/14/aurora-cannabis-growth-at-any-cost-to-shareholders.aspx

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