Last week’s midterms in Michigan, Missouri and Utah signaled more acceptance (and legalization) than ever before. The resounding victories in that trio means new business opportunities for those states (duh). More importantly? With those three it means that nearly 50% of the country allows medical and 20% of the US has rec-use on the books. So what are some good bets for states to legalize cannabis in 2019? Let’s take a look:

Cannabis In Illinois

No less an expert than MMLG’s own founder, Aaron Lachant, sees the Land of Lincoln as a solid opportunity, “I think Illinois could be a major player in cannabis legalization come 2019,” says Mr. Lachant. And following a busy 2018 for medical cannabis companies in Illinois it’s easy to understand why:

• A handful of Illinois-based medical cannabis companies –Green Thumb Industries and Cresco notably– have gone public on the Canadian markets, while others have also raised millions via private investment, with the nascent medical industry seeing rapid buyouts and consolidations showcasing exactly how aggressive Illinois companies are vying for marketshare.
• Illinois’ new governor, JB Pritzker, is a firm pro-legalization politician who sees business opportunities in expanding cannabis into the legal adult-use market.
• Similar to New York and New Jersey (see below); Illinois has a strong competition incentive to legalize in the forms of Missouri’s passage of medical and, more importantly, Michigan’s passage of adult-use cannabis to keep up with the Joneses of the Midwest. As we touched on last week, Michigan is in the catbird seat for the region with its legalization effort and is in a great position to grow its cannabis industry as now the nation’s second-largest market by population. Illinois, whether it is aware or not, has a lot to lose by not doing all it can to grow its canna-industry.

New York and New Jersey’s Ongoing Canna-Flirtation

We know, we know. You, dear reader, are exasperated by New Jersey’s ongoing struggles with expanding their medical market and, potentially, going to full legalization. Likewise, you’re frustrated by New York’s snail-paced expansion of medical marijuana and its continuing indecisiveness with adult-use recreational. BUT! We remain absolutely bullish on New Jersey and New York. Consider:

• Similar to Illinois now having to keep up with the Joneses, New Jersey and New York, but mostly NY, must keep up with states such as Massachusetts, Vermont, Connecticut and, yes, New Jersey.
• If anything, Massachusetts and Vermont’s continuing moves on the legalization front means New York moving with resolve if not expediency. Cuomo’s economic impact report on legalization opened a lot of eyes (and prompted this fall’s public listening sessions). New York gets it and does not want to fall further behind its neighboring states.
• For New Jersey? It’s more a matter of when and not if. State Democrats, despite their infighting, are working with Gov. Phil Murphy to keep expanding medical and to get legalization before 2020 (if possible considering the timeline). “As soon as Governor Murphy collects a tax dollar from a New York City resident, New York is going to push that bill right to the front,” Hadley Ford of iAnthus Capital explained to Forbes. Devotees of our blog will recognize that sentiment as something we’ve been espousing as scripture since early this year.

Not to be lost in the noise of NJ vs NY and, uhh, Illinois vs the Midwest: do not discount Wall Street’s influence on legalization. As we saw with Bank of America’s financing of Constellation’s deal with Canopy Growth, the scions of Wall Street are keenly attuned to what’s going on and are all too happy to swoop in with cash when opportunity presents. New York City and Chicago both have deep investment and financing-driven interest in what happens, if you don’t think that influences where 2019 and cannabis legalization goes than you’re reading the wrong blog.