How Australia’s legal marijuana industry is evolving and where it fits within the global market.
Summary:
The global legal marijuana market was valued at USD13.2 billion in 2021.
Australia’s legal marijuana industry was valued at USD51.8 million in 2021, with an expected CAGR of 30.1 per cent from 2022 to 2030.
Despite recent regulatory developments that legalised the growth of cannabis for medicinal and scientific purposes, pathways to access and pricing remain closed and cost-prohibitive compared to those in more developed markets.
Hemp was the largest segment of Australia’s legal marijuana industry in 2021, making up 83.2 per cent of revenue.
Major opportunities in the domestic market are the development of cannabinoid products for therapeutic use and the export of medicinal cannabis to overseas markets.
Australia’s legal marijuana (cannabis and hemp) industry is in its infancy. While policy developments since 2016 have created a market for manufacturers to grow and produce cannabis products for scientific research, therapeutic use or export to overseas markets, the lengthy process for getting medicinal products registered in Australia makes progress slow.
Over time, as the regulatory landscape and access pathways become more straightforward, the legal marijuana industry in Australia will continue to mature. This article provides an overview of Australia’s legal marijuana industry, where it fits within the global market, and key threats and opportunities that companies in the sector should address.
Given the lack of policy development around recreational marijuana use in Australia (with the exception of the ACT), this article focuses on legal marijuana in the context of medicinal and industrial use.
The history of legal marijuana in Australia
By global standards, Australia’s legal marijuana industry is still in its infancy, with the industry becoming more established following policy developments over the last seven years.
In 2016, the growth of cannabis in Australia for medicinal and scientific purposes was legalised by the Federal Government. The legalisation occurred through amending the Narcotic Drugs Act 1967 (Cth). Further, on 20 January 2020, the Australian capital Territory (ACT) Government decriminalised the possession, use and cultivation of cannabis for recreational use for people aged 18 years and over. The ACT’s decriminalisation allows people over 18 to possess up to 50 grams of dried marijuana and own two marijuana plants.
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