The Legal Cannabis Market Expected to Show Continued Growth
NEW YORK, February 7, 2018 /PRNewswire/ --
Data published by New Frontier Data estimates that the legal cannabis market was worth $6.6 billion in 2016 and is forecast to grow to $24.1 billion by 2025, and registering a compound annual growth rate of 16 percent. By segment, the medical cannabis market was worth $4.7 billion in 2016 and is expected to grow to $13.3 billion by 2025. Sales of recreational cannabis throughout the same period are expected to grow at a 21 percent CAGR, from $1.9 billion to $10.9 billion. The constant authentication of cannabis products for both medical and recreational use is a key factor contributing to the development made in this industry. On November 8th, 2016, California has passed California Proposition, allowing individuals in California to use and grow cannabis for personal use. Sugarmade, Inc. (OTC: SGMD), Surna, Inc. (OTC: SRNA), American Cannabis Company, Inc. (OTC: AMMJ), OWC Pharmaceutical Research Corp. (OTC: OWCP), Maple Leaf Green World, Inc. (OTC: MGWFF)
California's new recreational cannabis laws were formally realized on January 1st, 2018. New Frontier Data CEO, Giadha Aguirre De Carcer, commented on California's potential market growth, "California offers the perfect example of why it is so important to understand trends in consumer behavior. The state's legal (cannabis) industry is forecast to grow from $2.8 billion in 2017 to $5.6 billion in 2020. That spending will be increasingly directed at products and retailers who understand and serve the market's evolving tastes and preferences. The market is changing, and the most successful operators will be those who adapt most quickly to the change."
Sugarmade, Inc. (OTC: SGMD) yesterday announced, "the relocation of all business operations into a significantly larger facility, as it moves to further implement the recently announced marketing agreement with BizRight Hydroponics, Inc. Via this agreement, Sugarmade is expecting revenue growth during 2018 of at least 400%.
"We do not have nearly enough room at our current City of Industry, California location to accommodate the growth we are already realizing and are expecting for 2018 and beyond," commented Jimmy Chan, CEO of Sugarmade. "We are seeing something very special in the current marketplace. Once cultivation operators receive new licenses, one of the first moves is to buy the supplies required to move into the vegetative stage. Fortunately, we are seeing a lot of these orders, especially within the California marketplace. While hundreds of cultivation licenses have already been issued, there is still a significant backlog, which bodes well for us throughout 2018 and beyond. With more states coming online, the prospects are truly exciting."
Sugarmade's new operations center will consolidate nearly all corporate functions under one roof. The warehouse section was custom made for high volume shipments and is able to accommodate not only regular delivery trucks, but also full cargo containers. With its close proximity to both Southern California's most important freeway cargo routes and the vital port of Los Angeles, Sugarmade will be able to speed both importation of goods into the facility and delivery to customers."
Mr. Chan continued, "Not only is the new facility almost perfect for our needs, it is also located in close proximity to our current location, which should minimize move-related business disruption. We also have chosen this new site, which is at the Monrovia Technology Campus, because it offers a lot of configuration flexibility, and positioned us for future expansion. Our new address will be 750 Royal Oaks Drive, Suite 108, Monrovia, CA 91016."
Surna, Inc. (OTCQB: SRNA) is a Boulder, Colorado-based manufacturer of a proprietary line of optimized lighting, environmental control and air sanitation systems for state-regulated cannabis cultivation facilities as well as traditional indoor agricultural facilities. On November 14, 2017, the company announced operating and financial results for the three and nine months ended September 30, 2017. Revenue for the three months ended September 30, 2017 was $1,566,000 an increase of $395,000, or 34%, compared to the three months ended September 30, 2016. Recent and anticipated regulatory changes involving medicinal and/or recreational cannabis use in various jurisdictions, such as California, tends to be a leading indicator for the granting of licenses for new facility construction. As more new cultivation facilities become licensed, the company has an expanded set of opportunities and customers to whom we can potentially sell our systems.
American Cannabis Company, Inc. (OTCQB: AMMJ) offers end-to-end solutions to existing and aspiring participants in the cannabis industry. On January 17, 2018, the company announced that it has secured a consulting contract with Cloud 9 Apothecary in the state of California. In conjunction with the consulting agreement, ACC will acquire an equity stake in Cloud 9's project that is currently non-operational and in the development stage. This project, to be built-out and completed in Desert Springs, California, will comprise a closed-loop greenhouse containing a 22,000 square foot canopy of premium cannabis cultivars. With the construction of this facility, Cloud 9 Apothecary's plans focus on wholesale cultivation and product manufacturing. Plans to shift into a fully integrated business model, complete with dispensing solutions, will be made in the near future as Cloud 9 plans to scale up operations organically.
OWC Pharmaceutical Research Corp. (OTCQB: OWCP), through its wholly-owned Israeli subsidiary, One Word Cannabis Ltd., conducts medical research and clinical trials to develop cannabis-based pharmaceuticals and treatments for conditions including multiple myeloma, psoriasis, fibromyalgia, PTSD, and migraines. OWC is also developing unique delivery systems for the effective delivery and dosage of medical cannabis. On December 21, 2017, the company received a new permit from the Israel Medical Cannabis Agency to proceed with the safety study of their oral disintegrating tablet. The study protocol will be submitted to the Institutional Review Board [IRB] at a leading Israeli academic hospital in the coming weeks. The study is scheduled to start in Q2 2018. In October of 2016 OWC announced that it had completed the development of a proprietary cannabinoid-enriched sublingual tablet for the administration of medical cannabis. The Tablet constitutes a smoke-free alternative for patients using medical cannabis.
Maple Leaf Green World, Inc. (OTCQB: MGWFF) announced earlier in January that it has completed the purchase of all of the ownership interests in BioNeva Innovations of Henderson LLC ("BioNeva") and all of the ownership interest in the Nevada Medical Marijuana Registration Certificate C115. In accordance with the terms of the transaction, the previous holders of the ownership interest of BioNeva assigned their interest to Mr. Daniel Larkin, a newly appointed director of Maple Leaf as per below, who in turn will transfer one hundred percent of the ownership interest and related licenses to SSGW in accordance with the terms of a Confession of Judgment. BioNeva previously obtained conditional approvals for obtaining a Medical Marijuana Establishment - Cultivation Facility - Class V (Cultivation) business license (the "Cultivation License") in the City of Henderson, Nevada. Maple Leaf, through its Nevada subsidiary, SSGW, has now acquired its first existing cannabis cultivation permit.
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