New data collected about New Zealand’s illicit cannabis market reveals that the industry’s estimated value is $1.5 billion and that about 74,000 kilograms, or 74 metric tons, of cannabis is consumed every year.
This data (which was gathered by Wellington-based Business and Economic Research, aka BERL Economics) paints a vivid picture of what a legal recreational cannabis market could bring to the country in terms of revenue. BERL Economics crafted two reports, the “Evidence to inform a regulated cannabis market” and “Market structure for recreational cannabis.” In these reports, the company examined the viability of legalizing cannabis from a financial point of view, as well as baseline estimates for the market and what a post-legalization scenario would look like in New Zealand.
Overall, the numbers show that daily users make up the majority of cannabis consumers in the country, coming in at 85 percent in total. Approximately 12.7 percent of residents are considered to be frequent consumers, and those who are defined as “period users” were set at 2.1 percent. Very few people polled claimed that they hardly or never used cannabis.
The reports also made suggestions based on the expected number of consumers, mainly in the form of how many legal cultivation, processing and retail store licenses would be necessary to properly serve the entire country. In total, BERL Economics recommended an estimated 567 licenses.
On October 17, New Zealand legislators are holding a referendum in which voters can let the government know whether cannabis prohibition should end and whether cannabis should become a viable part of the economy. Ultimately, it will be up to the government to write up legislation and push it through Parliament.
Until then, current laws stand regarding punishment for cannabis possession. According to New Zealand Police, this includes up to a $500 fine and up to 14 years in prison, while crimes involving cultivation can result in up to seven years in prison and at least a $2,000 fine. Although, in 2018 the country’s antiquated cannabis law, the Misuse of Drugs Act 1975, was amended to allow less harsh punishments for those who use medical cannabis.