Though even the most basic comparison to alcohol makes some purists retch, American marijuana owes much to the country’s beer and wine industries.
State lawmakers and regulators are modeling licensing and distribution schemes for commercial-grade marijuana on the alcohol industry; a longtime alcohol-regulation bureaucrat now runs California’s Bureau of Medical Marijuana Regulation; and the sommelier-level taste and smell analysis of high-grade cannabis by would-be connoisseurs is lifted directly from the high-end wine playbook. And if it wasn’t for positive comparisons to alcohol—with political campaigns pushing the message that marijuana is a less dangerous and not-at-all deadly alternative to drinking life’s worries away—the first victories in the quest to legalize marijuana may not have been won.
Marijuana is now repaying the favor with existential dread. Alcohol purveyors and booze industry observers are worried that Americans will stop buying wine and start buying cannabis instead, further eating away at already diminishing alcohol sales.
Last year, Cowen & Company, a prominent New York-based investment bank, released a report suggesting that marijuana legalization had hurt beer sales, including in several western states where craft microbrews are a way of life. Big macrobrews like Coors and Budweiser had the most to fear, analysts predicted, but now other big alcohol could see sales slip as consumers swap out cocktail hour in favor of smoke sessions.
And according to a recent wine industry report released by Silicon Valley Bank, “[w]ine producers are worried their industry could see a slowdown as well,” FORTUNE wrote on Tuesday. “If the trend were to mirror what some are claiming is happening in the beer world, lower priced wines could see the greatest dent to sales.”
Wine isn’t exactly suffering. Sales are expected to rise by seven percent this year with the California harvest increasing by six percent to four million tons of grapes. But at the same time, marijuana sales continue to skyrocket, with $53.3 billion worth of marijuana sold throughout North America in 2016, including $7 billion in legal over the-counter sales.
Weed is already the most valuable cash crop in the country, worth several times California’s wine harvest. Consumers only have so much cash to spend, the thinking goes, and with marijuana use increasing, at least some new cannabis users will be former wine drinkers whose corkscrews are now gathering dust.
But the real problem may not be diminishing wine drinkers—it’s marijuana leading to a lack of people to pick grapes. Both vineyards and cannabis plants do well in hot, dry climates like the Mediterranean atmosphere seen in most of California. Farm workers, then, have the choice of picking grapes and working in the vineyard in the hot sun or trimming cannabis flowers.
With marijuana paying up to $35 an hour, according to a wine industry report picked up by Forbes, and wine work paying $15, which would you choose?
In the meantime, at least some representatives from the two industries, which have managed to coexist side-by-side in rural California counties, are more interested in working together than participating in a zero-sum game.
And not every booze industry report concerning cannabis is doom-and-gloom. According to one report, Cowen & Company had it all wrong: Legalization is helping alcohol sales. People who drink beer also seem to like to smoke weed, one brewery told the Guardian, and if someone visits Colorado to go to a dispensary, they may also spend a few dollars at a bar.
Then again, remember: some big alcohol companies have welcomed marijuana to the pantheon of acceptable American pastimes by pouring money into efforts to derail legalization. If victorious cannabis takes a bit of alcohol away, consider it comeuppance.
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