A new report pegs Australia’s recreational cannabis market at 7.8 billion Australian dollars ($5.5 billion) – assuming a fully legal and regulated market is put in place by 2023.
In neighboring New Zealand, commercial opportunities from a fully regulated recreational marijuana industry would top 977 million New Zealand dollars ($634 million), the report from United Kingdom-based analytics firm Prohibition Partners estimates.
The Oceania Cannabis Report – released this week – identifies opportunities and provides an overview of medical cannabis programs across the broader Oceania region, with a focus on Australia and New Zealand.
Market growth in the Oceania region is underpinned by progressive politics, which have already improved patient access to MMJ in Australia, Stephen Murphy, managing director of Prohibition Partners, told Marijuana Business Daily.
New Zealand is committed to holding a referendum on cannabis legalization by 2020.
“There are signs that the market is developing in the region, and although foreign companies currently dominate, we’ve noticed a number of local players – predominantly from Australia – vying for a slice of the international market,” he said.
“There is also evidence that local cannabis companies are poised to become significant exporters, enabling them to take a slice of the rapidly expanding global cannabis market,” according to the report.
The Prohibition Partners report also examines the medical cannabis markets in Australia and New Zealand, forecasting “primary” and “secondary” commercial opportunities at $2.1 billion and $237 million, respectively, by 2028 – pending a fully legal and regulated market.
The primary market refers to retail prices for end products. The secondary market references services and includes producers, manufacturers, laboratories, compliance, insurance and security.
Key Oceania markets where medical cannabis is legal include:
Ashmore and Cartier Islands
Coral Sea Islands
Federated States of Micronesia
Northern Mariana Islands
Wallis and Futuna
So far, Northern Mariana Islands is the only market where cannabis has been legalized for recreational use.
“The climate and geopolitical stability of the region make the area ideal for cannabis production,” the report notes. “Some strains of cannabis – sativa and sativa-dominant strains – that are harder and more costly to grow in the labs of more established country markets such as Canada can be easily grown in the region for export.”
The report pegged the industrial hemp industry across the region at $18.6 million by 2028, with Australia accounting for nearly the entire sector.