Market Revenues and Economic Opportunities in the Legal Cannabis Market in Uruguay

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dc.citation.issue2
dc.citation.volume7
dc.contributor.authorRychert M
dc.contributor.authorPardal M
dc.contributor.authorQueirolo R
dc.date.accessioned2025-09-10T23:01:35Z
dc.date.available2025-09-10T23:01:35Z
dc.date.issued2025-08-12
dc.description.abstractBackground: The regulated cannabis market in Uruguay has received international attention as an alternative to profit-maximising cannabis legalisation models. However, relatively little is known about how this market has been operationalised. The goal of our policy commentary is to identify the key actors with a role in the legal regulated cannabis market, provide estimates of the annual revenues, discuss the existing market opportunities, and consider the implications for the economic aspects of social justice. Methods: Our commentary is informed by a review of key relevant literature and other documentary sources, as well as insights from qualitative fieldwork in Montevideo. Results: Licensed production companies and pharmacies are key for-profit organisations involved in the recreational cannabis market in Uruguay. With prices, products, and market size controlled by the government, the entrepreneurial decisions of licensed producers are limited, resulting in a focus on cost reduction. The production sector is characterised by a small number of companies that operate at economies of scale, illustrating a ‘commoditised’ cannabis market model. The pharmacy-only retail framework has created new revenue for community pharmacists but may hinder the participation of small-scale legacy players. The not-for-profit Cannabis Social Club (CSC) sector has lower entry barriers and fewer requirements regarding products and prices, but only a few key individuals may benefit financially due to the sector non-profit regulation. Estimates of annual revenues in the licensed production (4–4.8 million USD), pharmacy point-of-sale (1.1–2.2 million USD) and CSC sectors (8–17.7 million USD) are provided. Conclusions: Despite not being designed to pursue economic objectives, the state-controlled cannabis market in Uruguay has created commercial opportunities for several actors. Our analysis suggests that this regulation may represent a compromise from an economic and social justice perspective.
dc.description.confidentialfalse
dc.format.pagination25-38
dc.identifier.citationRychert M, Pardal M, Queirolo R. (2025). Market Revenues and Economic Opportunities in the Legal Cannabis Market in Uruguay. Journal of Illicit Economies and Development. 7. 2. (pp. 25-38).
dc.identifier.doi10.31389/jied.250
dc.identifier.eissn2516-7227
dc.identifier.elements-typejournal-article
dc.identifier.urihttps://mro.massey.ac.nz/handle/10179/73533
dc.languageEnglish
dc.publisherLSE Press
dc.publisher.urihttps://jied.lse.ac.uk/articles/10.31389/jied.250
dc.relation.isPartOfJournal of Illicit Economies and Development
dc.rights(c) 2025 The Author/s
dc.rightsCC BY 4.0
dc.rights.urihttps://creativecommons.org/licenses/by/4.0/
dc.subjectcannabis industry
dc.subjectlegalisation
dc.subjectgovernment monopoly
dc.subjectcannabis retail
dc.subjectnon-profit
dc.subjectmarket
dc.titleMarket Revenues and Economic Opportunities in the Legal Cannabis Market in Uruguay
dc.typeJournal article
pubs.elements-id503097
pubs.organisational-groupOther
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