Should We Really Blame Weed Legalization for Declining Beer Sales?

A recent report found a correlation between marijuana legalization and a decline in beer sales. But the truth is a lot more complicated.
December 3, 2016, 5:00pm
Photo via Flickr user John Blyberg

There are currently 26 U.S. states where marijuana is legal (or will soon be legal) in some form, whether for recreational or medical use. Residents of those states have probably noticed significant increases in the number of conversations they've had about Trey Anastasio or Rick and Morty reruns. But in some of those states, beer sales are declining, and at least one analyst is blaming legal weed for that, too.


At a Brewbound conference earlier this week, Vivien Azer, the managing director and senior research analyst specializing in beverages, tobacco and cannabis for investment firm Cowen and Company said that beer sales in Colorado, Oregon, and Washington had fallen significantly after those states legalized recreational marijuana.

READ MORE: Legalized Marijuana Means Weed-Infused Booze Is Just Around the Bend

"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 said.

Azer's not alone here, either. Beer industry groups have spent the past couple of years wringing their collective hands and wondering how marijuana legalization would affect their bottom line.

According to MarketWatch, Azer's report said that sales of both Anheuser-Busch and Molson Coor's so-called economy beers (Busch, Miller High Life) and premium domestic beers (Budweiser, Coors Light) are all down in those three states. She also said that craft beer sales had either stalled or decreased in those states as well. But—and this is a big but—MarketWatch columnist Jason Notte says that beer sales have fallen everywhere in the past eight years, dropping from a high of 213.2 million barrels in 2008 to 206.3 million barrels in 2015.

Notte also argues that craft brewers in Washington, Colorado and Oregon aren't slowing down because of legal weed, but because those states were at the forefront of the craft beer boom—well ahead of the rest of the country—and that they may have just reached their saturation points. Only California has more breweries than any of those three states.

READ MORE: How the Weed Industry Is Affecting California's Vineyards

Some of Brewbound's other speakers weren't quite as quick to blame marijuana for an overall decline in craft beer sales, either. "We are moving to a period of slowing growth," Brewers Association chief economist Bart Watson said. "But even flat markets still have growth."

So yes, maybe beer sales are slipping in states where recreational marijuana is legal, but it could be due to a number of other factors that aren't in smokeable form. Correlation does not equal causation, brah.