Beer sales drop in US states where cannabis legalization is approved
Beer manufacturers in the United States supplying cannabis-related states have reported a sharp drop in sales, according to a new study by Cowen and Company.
Cowen and Company became the first Wall Street investment bank to embark on coverage of the cannabis industry by publishing a report on the short and long term outlook for the cannabis industry, as well as its implications for the alcohol and health care industries.
The US states have approved the full legalization of cannabis, and according to their new study , beer sales have dropped drastically in all of the territories conquered by marijuana.
"This is perhaps not surprising, given that US government data for the states of Colorado, Washington and Oregon, which show a steady increase in the incidence of cannabis among 18-25 year olds." , she added, “coupled with the lower incidence of alcohol use (last month). »Vivien Azer, Managing Director of Cowen and Company
In Colorado, Oregon and Washington, where recreational use of cannabis has been legalized, the beer business is underperforming, according to Vivien Azer, managing director of Cowen and Company and senior industry research analyst. drinks, tobacco and cannabis.
Azer unboxed the most recent data from these three countries - the beer market has been understaffed, for the past two years - the study finds that "the extent of underperformance has increased", with volumes quantity of beer falling to more than 2%. Which for the American market is considered a disaster.
“While retail marijuana sales have opened up in these markets at different times, with the three states now having fully established retail infrastructure, the (under) performance of beer sales in these markets is 'deteriorated during 2016'
In these markets, craft beer is slowing down, and major beer producers are struggling. Companies Bud Light, Coors Light saw their income drop by 2.4%. Cowen expects to see repercussions on Anheuser-Busch InBev (BUD) et MillerCoors (TAP).
Meanwhile, the growth of craft beer also slowed in the three markets analyzed by Cowen. Colorado is in decline, while Oregon and Washington continue to experience some growth, Azer said. Denver is under the greatest pressure, noting that total beer volumes in this market have fallen 6,4% year-to-date, as well as craft beer volumes which have plunged 5%.
In the meantime, imports appear to be "immune" to the legal pressure of marijuana, although all three states lag significantly behind seen nationwide growth.