CryptoURANUS Economics: 07/11/19

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Thursday, July 11, 2019

Canabis-Globalization-Industry: Cryptocurrency

Canabis-Globalization-Industry 


The global cannabis market is worth USD$150 billion today.

Barclays, in their European Consumer Staples Report in September 2018, suggests that this figure could increase to USD$272 billion by 2028.



The UN estimates that, well over, in a conservative approximation of 4.0% of the global adult population, or over 190 million people, are cannabis users (vs. 1 billion smokers). 




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The highest level of cannabis users is found in Europe, followed by the US and the Oceania Region. 

In this European location, Although small, the Oceania Region is considered significant given its access to the Asia Pacific geography areas.

Cannabis Use Cases

Medicinal – here, cannabis is used to treat illnesses such as pain and inflammation, controlling epileptic seizures and possibly even sleep deprivation mental illnesses and addictive drug habbits.

Recreational Cannabis – Where cannabis is smoked or made into a high THC concentrations, which involves refining cannabis into an untainted, cleaner, and potent, infused products, and edibles. 

Most popular are the Edible products that are the fastest-growing part of the market and incorporate mints, gummies, candy, ice-cream, and cookies. Infused products include alcohol, ointments, and vaporisers.
 

Industrial Cannabis – the cannabis used for industrial purposes is defined as "hemp". 

Hemp has been used for hundreds  of thousands of years in paper, textiles, clothing, biodegradable plastics, paint, insulation, (just to name very few), and far more products spanning within historical records of our time.

The cannabis industry has been inhibited by regulatory restrictions for most of recent history by mega pharmaceutical industries lobbying global governments, but the legal market has emerged rapidly worldwide as more governments legalize medical and secondly recreational use.
Driven by efficacy, medicinal marijuana is gaining traction both within medical fraternity circles and within global general populations.  

The political stigma is slowly being challenged scientific facts destroying pharmaceutical conspiracy-theories and is being rewritten into history as one of the largest lies in history against Cannabis consumption. 

Medicinal pharmaceuticals are force feed acceptance of the drug leads to the eventual legalization for recreational use and medical use.

Legalization versus decriminalization

There is a clear movement from strict prohibition of cannabis motivated by mega-pharmaceuticals that lobbied governments worldwide, the lines can be blurred between different forms of economic political lines. 

This will be refereed to as legalization and/or the decriminalization of cannabis from past documents accounts and into future scientific research uncovering.

The most liberating form of deregulation is legalization. 

This method is considered an effective method of tackling benificial illicit markets leading into the creation of a commercial, regulated market where competitive forces drive down dangerous tainted Cannabis prices and costs, undercutting the dangerous chemical additives placed into the street illegal market places.


Many, however, consider the creation of a commercial market is unhealthy for two reasons:


  1. It can lead to widespread consumption of cannabis, which for many years a myth has been perceived as the ”devil’s drug”, and the primary the gateway to harder substance addiction -i.e. mega-pharmaceutical lobbying influences; again. 
  2. If cannabis is advertised and promoted, it can increase youth prevalence. It is for these reasons that the decriminalisation of cannabis is considered a suitable alternative to destroy the myths and make healthier nations via Cannabis. 
It is still illegal to possess cannabis, however, possession is  being treated as a lesser administrative offense rather than a felonious criminal offense. 

People are fined, rather than put in prison as back in the old days. Opponents to decriminalisation point out that it does not tackle the presence of the black market, but promotes the adrenilin excitement and fame of illegal illicit drug sales. 


The Case for Cannabis Legalization

Canada had the following aims with its legalisation of cannabis:
  1. Reduce the consumption of cannabis by young people.
  2. Keep profits from the cannabis market out of the hands of criminals.
  3. Strengthen law enforcement measures to deter the sale of cannabis outside the legal framework, especially to young people.
  4. Establish and enforce strict regulations around producing, distributing and selling cannabis.
  5. Continue to provide access to cannabis for medical purposes.
  6. Apply taxes to legal cannabis sales.

“Some common threads that underpin the arguments for legalising cannabis are that: cannabis is relatively less harmful than other drugs, including other legal drugs, the costs of enforcement of existing criminalisation are high and that there are perceived medicinal benefits that are not being exploited.”
– The PBO, Canada



The Political Movement

The federal legalisation of recreational-use cannabis in Canada, medicinal-use legalisation in the UK and Germany, and partial legalisation in some US states, (and do not forget this remains federally illegal) , shows just how strong the case is for legalisation is.
Despite the sharp divides in support for cannabis legalisation, a few things are clear: public support for marijuana legalisation continues to increase, the industry is already a multibillion-dollar juggernaut that looks primed for continued expansion, and there are clear potential medical benefits of cannabis.

The FDA’s approval of Epidiolex in July 2018 (the first ever cannabis-plant based drug approved by the FDA, because it was mega-pharmaceutical manufactured), and its subsequent rescheduling by the DEA, marked a great moment for the recognition of the effectiveness of medicinal marijuana as a treatment method for countlss ailments.

A booming Industry

As global recognition of the benefits of medicinal cannabis increases ends of the prohibition era for cannabis.

There is a need for high-quality products at large scale for consistent, reliable supply to health users. 
It is safe to say that the Cannabis industry will soon become the most lucrative and thriving industrial sector in the world until mega-pharmaceuticals take ownership. 

Cannabis cultivation is an industry with quality standards.
The Cannabis market is a result of the federal legislation and export policies, are driving the global markets and fuelling the hyperbolic growth currently being played out in current industry.

Growth will not continue to come from the private style industry, but later will solidify form the entry of massive global mega-pharmaceutical players. 


In Constellation Cannabis Brands with massive investment triple Canopy Growth, Molson Coors partnership with Hexo, and of course Altria’s (who own the Marlboro Brand) investment of USD$1.8 billion into The Cronos Group.
Let’s consider some of the regions and their largest countries.



    The Oceania Region Cannabis Market – the gateway to Asia

    The Oceania market is set to quadruple in the next 10 years. Yes – you read that right! With an overall population of 40 million, and comprising over 30 countries, this is a large and strategic market for Cannabis. It is also a market that already displays significant usage. The latest report from Prohibition Partners, […]
    Read the Full Post

    Latin America – The Cannabis Industry’s Low Cost Producers

    The region consists of 42 countries, 650 million people, and combined health care spend of USD$354 billion. In Uruguay, it boasts the first country in the world to legalise cannabis for full recreational use in 2013. And through Colombia, it accounts for 44% of the allotted cannabis exportation quota to the international markets. 10 Latin […]
    Read the Full Post

    Europe – The World’s Largest Cannabis Market

    Moore’s Law suggests that computing power doubles in capacity every 2 years. Europe could be considered a Legal Version of Moore’s Law. The continent has seen the number of member countries legalising medicinal marijuana double in each of the past 4 years (2 every 2 years). This is (essentially) the biggest Cannabis market on the […]
    Read the Full Post

    Just how big could the US marijuana market be?

    *Updated 18th November In any business, the total addressable market size is always extremely important. What’s the potential? How much is this industry actually worth? The term $20 by 20” has often been used to describe the US Marijuana market. The potential size of the industry by 2020 could be $20 billion. Now, as we […]
    Read the Full Post


The industry is simply moving too fast to know exactly what lies ahead. 


It’s a commodity

Many entrepreneurs, as private citizen are racing to get licesenced into producion. 

Colorado has legalised cannabis in 2014 and has recorded dramatic decrease in cannabis prices per kilogram. 

The Cannabis market is scaling up. There is a massive oversupply of cannabis bearing downward pressure upon the Cannabius prices.
Producers that are not differentiated will suffer in the medium term and the small “low cost” growers will struggle to gain a foothold. 

It’s not even grown

Synthesized cannabis – AKA, CBD grown in labs and not in greenhouses is the current way of the future profits. 

Recently Cronos Group announced an investment in GinkoBio, a company that is pioneering the production of synthesised CBD. 

This is a significant impact on the industry, as it puts more pressure on Licensed Producers that have spent an inordinate amount of Capex to establish cultivation centers and currently being laughed at.


The money’s in retail

Investors made massive gains in the licensed producers (Aphria, Canopy Growth, and Aurora to name drop a few). 

With recreational legalisation legally in active in place sends shockwaves into all Cannabis retail market-places in full swing.

Remember, it is the retailers that will ultimately capture the lion’s share of the margin, but mega-pharmaceuticals are the super-predators patiently in wait to own all in this end-game.


It’s going to be about brands

Consumers will demand high-quality brands, and with research showing that consumers display great loyalty to their retail outlet and their brand of choice.

Hint: Do you buy beer or do you buy Corona?

Some of the biggest Cannabis Companies in the world are already here

The company "Canopy Growth" leads the prepharma wolf-pack with a valuation of aprox: USD$11.0 billion. 

The Big Pharma, Alcohol and Tobacco are actively tracking the industry and Canopy will eventually be dwarfed by the likes of Coca-Cola, Diageo or Novartis.




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