Should alcohol retailers, producers and distributors worry about legal cannabis siphoning off sales? Not according to the Distilled Spirits Council.
Sales of distilled spirits have not shown a negative impact in the first three states that legalized recreational cannabis, according to a new study by DISCUS. Nor have overall alcohol sales.
Utilizing state-level alcohol tax receipts and alcohol shipment data, this study examined per capita alcohol sales in Colorado, Washington and Oregon for the two years prior to recreational cannabis legalization, and three-four years post-legalization (depending on the state).
“Simply put, the data show there has been no impact on spirits sales from recreational marijuana legalization,” explains DISCUS Chief Economist David Ozgo. “We now have four years of retail recreational marijuana sales history in Colorado and Washington state, and three years in Oregon, and each of these markets remain robust for spirits sales.”
He noted that overall alcohol sales mirror national trends and there is no pattern of declining spirits sales in any of the markets analyzed.
“We did this study because there is a lot of misinformation circulating about the impact of recreational marijuana legalization on distilled spirits and the wider alcohol market,” Ozgo says.
The analysis shows that in the three states, per capita spirits sales increased between 3.6 to 7.6% since recreational cannabis legalization took effect.
Additionally, there was no evidence that legal recreational cannabis has impacted total per capita alcohol sales. According to the data:
- In the three states, per capita beer sales declined between -2.3 to -3.6%, but Ozgo noted this is consistent with the national trend in the category and is not isolated to just those states that have legalized pot. Research released last fall by the Brewers Association suggested that legal cannabis might actually help craft beer sales.
- In the three states, per capita wine sales were mixed.
- In the three states, per capita total beverage alcohol sales (spirits, wine and beer) were roughly flat. These results are consistent with the national trend.
While DISCUS has taken no position on whether states should legalize recreational cannabis, it has established policy principles that the council urges state officials to consider if pursuing legalization.
“If states contemplate marijuana legalization, we urge lawmakers to ensure they fully consider comparable taxes and regulation, strong road safety measures and social responsibility standards when they examine the issue,” says DISCUS President & CEO Chris Swonger. “The spirits industry has long been a leader in traffic safety and personal responsibility through the Foundation for Advancing Alcohol Responsibility, and we are proud of the historic downward trends in both underage drinking and drunk driving.”
Currently 10 states and the District of Columbia have legalized recreational marijuana. Most recently, a cannabis ballot initiative passed in Michigan, but failed in North Dakota.