Big Alcohol Watching Profits Plummet In States Where They Legally Compete With Cannabis

By Justin Gardner

Back in August, we learned through the WikiLeaks email dump that an alcohol lobbying group was peddling propaganda to lawmakers in the attempt to stifle cannabis legalization. Claiming to be “neutral” on the subject, they did not hesitate to spout falsehoods and fear-mongering about the “dangers” of cannabis.

And then, as nine states were preparing to vote on legal cannabis in the November elections, alcohol lobbying groups were exposed as major funders of anti-pot efforts in various states, including Massachusetts and Arizona. The Intercept also noted beer and liquor companies predicted in SEC filings that legal cannabis would threaten their profits.

They were correct.

Brewbound, a craft beer interest group, first reported on an analysis by Cowen and Company finding that beer markets are shrinking in three states with legal cannabis – Colorado, Oregon, and Washington.

[Vivien] Azer unpacked the latest Nielsen data in those three states — beer markets that have “collectively underperformed” in the last two years — and found that “the magnitude of the underperformance has increased notably,” with beer volumes falling more than two percent year-to-date and trailing the overall U.S. beer market.

“While (marijuana) retail sales opened up in these markets at different points of time, with all three of these states now having fully implemented a retail infrastructure, the underperformance of beer in these markets has worsened over the course of 2016,” Azer wrote.

Interestingly, mainstream beer producers and so-called “premium domestic” beers such as Bud Light and Coors Light are showing the biggest drop – to the tune of 2.4 and 4.4 percent, respectively – while craft beer volumes are performing better. It seems cannabis users appreciate good taste.

Colorado is seeing a decline in craft beer volumes, but Oregon and Washington craft beers are still in a growth phase. Total beer volumes (mainstream and crafts) in Colorado have fallen 6.4 percent.

Although there is a general deceleration in craft beer volumes nationwide, the effect is more pronounced in the three legal cannabis states where data were analyzed. Imported beers appear to be immune, but even they are lagging behind the national growth trend in legal cannabis states.

While several craft brewing companies are actually welcoming pot legalization, mainstream corporations see it as a “big threat.” This explains their attempt to fund the continued prohibition of cannabis – using government to protect their profits.

Alcohol certainly enjoys a huge advantage, as this highly addictive and dangerous drug is not even classified under the Controlled Substance Act. Federal government leaves alcohol regulation to the states, which reap massive profits through extortion fees (licensing) and exorbitant “sin taxes.”

As more people turn from alcohol to cannabis, perhaps society as a whole will benefit, considering that a scientific study found alcohol fuels aggression while cannabis makes you peaceful.

Justin Gardner writes for TheFreeThoughtProject.com, where this article first appeared.