California officials have unveiled a new report on the current status and future of the state’s marijuana market—with independent analysts concluding that the federal prohibition on cannabis that prevents interstate commerce is meaningfully bolstering the illicit market.

The California Cannabis Market Outlook 2024 report looked at consumer trends, industry data, regulatory enforcement actions and more, finding that just about 40 percent of consumers are buying from legal operators years into the implementation of legalization. But as the legal state markets continue to expand and mature, the report says federal laws preventing interstate commerce are significantly impacting the marketplace.

“… as long as interstate trade remains federally illegal, licensed market participants are at a competitive disadvantage relative to illicit market participants who distribute across state borders,” the analysis said.

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