Big Tobacco Ready To Venture Into The Cannabis Industry

in #market7 years ago

It is no surprise that big tobacco companies might be wanting to stake a claim in the cannabis market.

Over the last decade, smoking prevalence in the US has dramatically decreased. And since 1980, global prevalence of smoking is said to have declined about 42 percent for women and down 25 percent for men. Considering that there are billions here to be made in the cannabis industry, it's no wonder that tobacco giants might be considering the move to providing cannabis products.

Imperial Brands Plc in the UK is said to have recently sought out the services of an expert and leader in the field of medicinal cannabis. Just to give you an idea of the size of Imperial Brands Plc, this company has yearly revenue in the tens of billions.

The expert they called on was allegedly Simon Langelier who is the chairman of a supplier of cannabis oil extracts; PharmaCielo Ltd. And Langelier is said to has temporarily joined the board for Imperial Brands Plc, to act as a non-executive director.

It's reported that Langelier will be tasked with widening consumer adjacencies for the company, he's going to help them to diversify. It's rather clear that Imperial Brands is going to look now toward getting more involved in the cannabis market.

When it comes to the popularity of consuming cannabis, it's growing around the world. In the US for example, you can see from the chart below how popular the activity is compared to the consumption of other items.

Imperial Brands aren't the only big tobacco player that have been looking at the cannabis industry either.

But if these companies look to sell cannabis instead of tobacco, will the consumers be willing to trust purchasing their product from them rather than someone else. After all, the tobacco industry doesn't have the best reputation; maybe cannabis can fix that for them?

Their interest with tobacco companies to get involved in cannabis might also be something that has been brewing for many decades, and not something that's just flourished recently because of the new push for legalization and acceptance of the plant globally. It's reported that since the 1970s, big tobacco companies have been interested in cannabis and the legalization thereof.

The cannabis market in the US has become so sizable that big consumer product companies are unable to ignore it now; they'd be foolish to. The cannabis sales for 2016 were estimated to be somewhere around the ballpark of $6.7 billion and it's expected that those sales are going to top 20 billion within just the next couple of years.

And the $6.7 is just for "legal" sales of the product, whereas "illegal sales are estimated to be somewhere around $40 billion.

The legalization of cannabis has been described as the fastest growing industry within the US and it's projected that it could bring about the creation of more than 250,000+ new jobs by 2020.


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Pics:
Iriana Shiyan Shutterstock
digiday.jp
Euromonitor International, MBD via Bloomberg

Sources:
http://www.economist.com/blogs/economist-explains/2015/07/economist-explains-7
http://www.bloomberg.com/gadfly/articles/2016-04-20/marijuana-could-be-big-tobacco-s-next-pot-of-gold
https://www.sciencedaily.com/releases/2014/01/140107170737.htm
https://www.bloomberg.com/news/articles/2017-06-13/imperial-brands-board-gets-counsel-of-cannabis-company-leader
https://www.bloomberg.com/gadfly/articles/2016-04-20/marijuana-could-be-big-tobacco-s-next-pot-of-gold
https://etfdailynews.com/2016/12/09/is-altria-the-best-way-to-play-legal-marijuana/
https://www.forbes.com/sites/greatspeculations/2015/07/01/altria-opportunity-in-the-market-for-marijuana/#20785a92965d
https://www.usatoday.com/story/money/business/2015/04/11/cigarettes-and-marijuana/70746772/
http://dailycaller.com/2016/01/04/tobacco-giants-eye-lucrative-50-billion-marijuana-market/
http://www.businessinsider.com/arcview-north-america-marijuana-industry-revenue-2016-2017-1
https://www.inc.com/will-yakowicz/marijuana-sales-2016-50-billion.html
http://www.huffingtonpost.com/2015/01/26/marijuana-industry-fastest-growing_n_6540166.html
https://www.forbes.com/sites/debraborchardt/2017/02/22/marijuana-industry-projected-to-create-more-jobs-than-manufacturing-by-2020/#276a51d53fa9

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Great piece well written, i support it :)

Finally getting to the place that marijuana legalization has been heading too. Of course there was almost certainly a plan on the part of big tobacco to engage in marijuana sales for decades now, they've just waited for the profit/optics balance to flip. I guess we're getting there!

Yeah i think it's a good idea as long as they don't start putting all kinds of chemicals like they do in Tobacco. But it could be a good change and it could be a bad haha They just need to legalize it world wide damn just like tobacco!!!

very dope sharing ,thank you :)
here in Latvia nobody wants talk about it , even government says old lies how bad is it ...bla bla bla shame.

So now we need to hide ,if you want to smoke your stuff ,and then look forward to find Visine ,to get red off from ya eyes haha .. So then
you are ALWAYS SOBER :D
visine copy.jpg

I don't like the thought of tobacco companies selling cannabis but if it helps with legalizing it then I guess its for the greater good. I worry that they'll spray it with nasty pesticides and chemicals as they already do with tobacco.

I agree with your point, I also didn't like the initial thought of big tobacco selling cannabis products. However, one has to imagine with their already-established factories, marketing, etc. that there is potential for these companies to make cannabis more easily obtainable with existing channels and for a cheaper price! Plus, with tobacco companies diving into the cannabis trade, one can expect their focus to shift away from dangerous tobacco and more into healthy cannabis alternatives. Might not be the worst thing for us all!

i expect it'll be a hard sell for them lol but they've got the money to market it!

True, they did the same with vaping. I hope I'd be able to grow some for personal use.

buying up vape producers like crazy

That is a legitimate concern, though the illegal stuff that is around is frequently treated with banned products. I think the real thing we all have to do is vote with our $$$. So, we need to drive the tobacco industry away from harmful pesticides and towards helpful growing techniques. Just as we need to continue the drive away from smoking tobacco and towards cannabis.

hey ...far out man

true , great article , and thanks for sharing with us.

If Big Tobacco gets involved, it won't be long before their lobbyists will be providing "legislation" to "protect" Americans.

i.e. Help Big Tobacco monopolize it.

My bet is that they've had laws written for decades just waiting for the time to be right to roll them out in an attempt to crush any potential competitors under a mountain of regulations and compliance.

that's the fear, folks trying to use violence to "protect us" lol

Not to mention the fact that they have a proven track record of manipulating nicotine content in cigarettes to make them more addictive/toxic.

You know they're trying to pull something when they roll out the "protect" or "safety" or, worse yet for the "protection and safety of the CHILDREN".

hahaha... that's a horrible thought. And, yet, would surprise me either.

Hope the small players don't get taken out by the big corps!

We make and break the big corps. Only spend at small shops and you'll help protect them.

i would much rather support the small players, well whoever has the best product which is usually the small players in the cannabis industry

yeah me too - it will all depend on the end product...

They will. That's Capitalism

no, that's corporatism :)

I am sure that within a few years 20 "HIGHS" will be available like 20 Marlboro are now. Branding is Branding, folks love a brand I can see "Marlboro Highs".

The tobacco industry has no intent on losing market share. I recently discovered that the big tobacco own all the tobacco quit patch companies so you see, they have you at every stage and intend on staying that way so Cannabis is the natural progression as we turn away from tobacco.

I'm fairly sure I read somewhere that it was the tobacco industry that got it banned in the first place.

wouldn't be surprised!

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