According to an April report by New York City-based Rabobank, “existing research does indicate that rising marijuana use will negatively affect the growth of beverage alcohol.”
The primary drivers of this trend include the fact that women and older consumers are saying they intend to use more marijuana when it is legal; a focus on health that cannabis fits into; and marijuana becoming legalized in states that already have high levels of wine consumption.
The report notes that “every demographic group expected their marijuana consumption to rise, but the rise was especially significant among women and older, wealthier consumers,” which makes sense because “these individuals conceivably have the most to lose [like mortgages or higher-paying jobs] if caught using [or] possessing illegal drugs.”
In terms of cannabis’s health conscious appeal, “For weight-conscious consumers, a group skewing slightly female, marijuana has another advantage: It is calorie free.” Rabobank adds that cannabis companies are expected to market the product as a “healthy, ‘lifestyle’ product.”
Wine also stands to lose as cannabis is being steadily legalized in states that are home to robust wine consumption. “According to IWSR [the London-based research group that does not spell out its name], the average per-capita wine consumption in states with legalized marijuana is 13.4 liters. The average for states without legal adult-use marijuana is 8.2 liters. Over 30% of U.S. wine, by volume, is consumed in states that have legalized adult-use marijuana.”
A Closer Look at the Data
In a recent interview, Stephen Rannekleiv, a global sector strategist for beverages in Rabobank’s New York City offices, took a deeper dive into the data. Markets like California, he noted, stand to lose more wine consumption as wine is currently consumed in higher quantities there than in markets such as New York.
The second major reason that wine consumption might decline more in California is that the state is more advanced in the cannabis legalization process, Rannekleiv said. It could also be said that “California moved faster on the legalization process because there is more consumer interest, so changes may be a bit more pronounced.”
Rannekleiv continued that he doesn’t envision “the hardcore wine enthusiasts, or those that like wine because of how it reflects on their image/status, suddenly replacing wine with cannabis.” The move to replace wine with marijuana is more likely to happen at the end of the day with consumers who will use it to unwind, he added.
These wine consumers may “not be hardcore [wine] enthusiasts. They tend to skew to the under-$10 segments.” As a result, “I would guess this is the price segment most likely to see some potential impact from legalization.”
In the end, those who want to have a rare steak after a hard day in the office are not likely to pair it with cannabis, but other types of wine-to-marijuana usage shifts are likely to be seen on the horizon.
