Illicit Cannabis Still Dominates in Many Legal States, and Hemp-Derived THC Is a Growing Wild Card

THC market size accounted for 90% or more of the combined cannabis market value across all 12 states regardless of legalization status. The composition of THC markets varied considerably even among states with the same legalization status. Hemp-derived THC emerged as a significant market segment in both legal and non-legal states, highlighting regulatory gaps.

Multi-source analysis combining national and state-level public data, Euromonitor Passport database, in-store audits (n=142), retailer interviews (n=78), and expert interviews (n=10) to estimate 2024 annual sales values across legal recreational, medical, illicit, and hemp-derived THC segments in 12 US states.

This study provides a rare comprehensive view of the full cannabis market, including the illicit and hemp-derived segments that are often excluded from official statistics. The persistence of illicit markets alongside legal ones and the rapid emergence of hemp-derived THC challenge assumptions about how legalization reshapes cannabis access.

The emergence of hemp-derived THC products, legal under the 2018 Farm Bill but often unregulated at the state level, represents a major challenge for cannabis regulation. Combined with persistent illicit markets, the picture suggests that legalization alone does not eliminate the need for robust regulatory oversight.

Illicit market estimates are inherently uncertain. Only 12 states included. Relies on multiple data sources with different methodologies and potential biases. Rapidly evolving market conditions mean 2024 estimates may not reflect the current landscape.