Canada's Population Surpasses 41 Million: Ambitious Immigration Levels a Key Ingredient for Grocers' Long-Term Revenue Growth

In this commentary, we discuss how Canada’s considerable immigration-driven population growth is affecting the country’s grocery sector.

Key Highlights:
-- Canada's population just set a new record, surpassing 41 million people only nine months after exceeding the 40 million mark.
-- The recent surge in immigration—and ambitious immigration targets for the coming years—should provide a notable tailwind to the country's grocery sector as newcomers spend on essential services and goods, including groceries.
-- A material decline in immigration levels could negatively affect grocers’ long-term revenue growth trajectory and increase the sector's already intense competition.
-- To capitalize on the population-driven growth in market size and maintain their market position, grocers will have to ensure they allocate sufficient capital expenditures to growing their store and logistics infrastructures.

“Inflation and population growth are the principal drivers of the grocery sector's long-term aggregate revenue evolution,” said Moritz Steinbauer, Senior Vice President, Sector Lead – Corporate Ratings, Diversified Industries. “As such, the recent immigration influx, as well as the ambitious immigration targets, should help to underpin the grocery sector's long-term growth prospects.”