A new Canadian study found that marijuana legalization was “associated” with a drop in beer sales, suggesting a substitute effect where consumers switch from one product to another.
The study, published in Drug and Alcohol Dependence, found that since Canada legalized adult-use cannabis in 2018, beer sales continued to decline.
Researchers from University of Manitoba and University of Toronto discovered that Canada-wide beer sales dropped by 96 hectoliters for every 100,000 people immediately following non-medical marijuana legalization, and then by 4 hectoliters each month afterward. This equates to an average monthly decrease of 136 Hectoliters for every 100,000 people post-legalization.
The authors of the study said that data suggests a substitution effect, where consumers are increasingly choosing marijuana as their preferred intoxicant over beer.
The decline in beer sales after legalization suggests that people are turning to cannabis instead.
The study concluded that “While cannabis use is not always harmless, and more research is required to understand the health impacts of switching from alcohol to marijuana, the decrease in beer sales associated to the non-medical legalization of cannabis suggests that people are not likely to be using both alcohol and cannabis at the same time.”
However, the trend did not apply to spirits. The trend was not seen in spirits sales.
The study states that “cans are preferred over bottles in the context individual consumption at home because of the increased popularity and availability of the cans, as well as their better taste and drink experience.” The study found that cannabis is substituted for beer at home, but not bottled beer.
The immediate impact of non-medical marijuana legalization on beer sales was significant. Although the decline appears modest, it has a large economic impact.
According to MJ Biz , new data released by Statistics Canada shows that Canada’s excise taxes on marijuana were higher ($660 million) in 2022-23 than the combined tax revenues from wine ($205 millions) and beer ($450millions) during this fiscal year.
In several states in the U.S. cannabis sales are outpacing alcohol.
According to a nonpartisan report by the House Fiscal Agency, Michigan marijuana sales exceeded the combined purchases of beer and wine in the most recent fiscal period.
In Illinois, the legal cannabis industry brought in $451 million during the fiscal year ending in June of last year– approximately $135.6 millions more than alcohol.
Colorado, in 2022, generated more revenue from marijuana than either alcohol or cigarettes — and nearly as much alcohol and tobacco together. Arizona, and Washington State have also achieved similar milestones.
In a recent report, a multinational bank stated that marijuana is now a “formidable rival” to alcohol. The bank projected that over the next five-year period, nearly 20 million people would regularly consume cannabis as booze lost a couple of million drinkers. The report also states that marijuana sales in the U.S. are expected to reach $37billion in 2027 as more state markets open.
Another study, published in November, also concluded that marijuana reform may have a “substitution” effect. Young adults in California reduced their consumption of alcohol and tobacco “significantly” after the cannabis law was passed.
A Gallup poll published in August last year also revealed that Americans believe marijuana is less harmful than other tobacco products, such as alcohol, cigarettes and vapes.
The American Psychiatric Association and Morning Consult released a separate survey in June that found Americans believe marijuana is significantly less harmful than alcohol, cigarettes and opioids. They also say cannabis has a lower addiction rate than all of these substances and technology.
A survey conducted in 2022 revealed that Americans believed that marijuana was less harmful than alcohol or tobacco.
Marijuana Users Have a ‘Significantly Reduced Chances’ of Cognitive Decline
The article Marijuana Legalization is Linked to a ‘Decline in Beer Sales’, Indicating Substitution, Canadian Study Finds first appeared on Marijuana Moment.
