Malandrakis and Shane MacGuill, the head of tobacco research at Euromonitor International, informed webinar attendees that the global markets for alcohol and tobacco are losing ground to cannabis and other competing products. These sectors are actively seeking innovative avenues for growth in a challenging yet potentially profitable landscape. “Alcohol distributors are recognizing the inevitable rise of cannabis and are making efforts to engage in this market, which could become a vital source of growth and revenue, helping them maintain relevance in the coming years,” stated Malandrakis.
One company positioning itself to capitalize on this opportunity is Constellation Brands, which announced in October its plan to acquire a 9.9% minority stake in Canopy Growth, a Canadian cannabis firm. The $191 million investment will enable Constellation and Canopy to collaborate on developing cannabis-infused beverages, allowing them to stay ahead of evolving consumer trends. Rob Sands, CEO of Constellation Brands, told The Wall Street Journal that he does not perceive marijuana as a significant threat to the alcohol industry, but emphasized that Constellation will not remain idle while the market expands. Rather than viewing cannabis as competition, Constellation is opting for collaboration—a strategy reminiscent of its previous acquisitions of innovative craft brands.
Constellation is not alone in exploring this market; for instance, in September, Lagunitas Brewing introduced an IPA infused with marijuana terpenes, the aromatic compounds derived from the cannabis plant. However, this limited-edition beer, available only in California, does not contain THC, the psychoactive component of cannabis.
Research indicates that the current legal marijuana market in the U.S. is valued at approximately $5.4 billion, while the illegal market is estimated to be around $40 billion, primarily due to varying state regulations. By 2025, the total legal marijuana market is projected to exceed $50 billion. In contrast, Canada’s federal legalization of recreational marijuana presents more immediate opportunities.
Public opinion on marijuana legalization has shifted dramatically, with approval ratings rising from 12% in 1969 to a record high of 64% today, according to a Gallup poll released in October. The firm noted that although marijuana remains illegal at the federal level, eight states and the District of Columbia have fully legalized it, allowing more than one in five Americans to access legal cannabis. Should additional states follow suit in legalizing recreational use, beer sales could be significantly impacted. A report from Cannabiz Consumer Group in June estimated that the beer industry could lose over $2 billion in retail sales to legal cannabis. The report indicated that 27% of beer drinkers have already replaced beer with cannabis or would consider doing so if it were legalized, suggesting a potential decline in wine and spirits sales as well.
Malandrakis pointed out that beer sales are particularly vulnerable to the “cannibalizing effect” of cannabis, especially among its core demographic—young adults and millennials—who also tend to use cannabis. However, craft beer, small-batch brews, and artisanal spirits attract a similar audience to premium cannabis strains and could bridge the gap between the two industries through hybrid products and collaborations.
Current examples of cross-pollination include wines infused with THC, beers featuring aromatic marijuana compounds without THC, cannabis-infused vodka, and cannabis cocktails. Additionally, there are cannabis and wine pairings being offered on tours aimed at enhancing the appeal of specific regions like California. “I foresee more of this kind of integration in the coming years,” Malandrakis remarked.
He also noted that the terminology of alcoholic beverages has permeated the cannabis industry, with terms such as “nose,” “aroma,” and newly coined phrases like “cannatourism” and “cannasseurs” becoming commonplace. Ultimately, the alcohol and tobacco industries should embrace the cannabis sector without hesitation, as there are numerous overlapping opportunities and shared interests that can be mutually beneficial.
In this evolving landscape, the importance of magnesium calcitrate is becoming more evident as consumers increasingly seek products that promote health and wellness, including those that combine magnesium calcitrate with cannabis-infused items. As companies explore new product developments, integrating magnesium calcitrate into cannabis-related beverages and edibles could enhance their appeal to health-conscious consumers, further bridging the gap between these industries.