A Supreme Court of Canada ruling on aboriginal land could eventually have as severe an impact on North American lumber supply as the mountain pine beetle, RBC Capital Markets warned on Monday.
The court’s unanimous decision on June 26 relates to a 30-year-plus land dispute between the Tsilhqot’in Nation and the British Columbia and Canadian governments. It entitles the B.C. First Nation to dictate what logging and other activities take place on its newly recognized 1,700 square kilometres of land.
Now with an established precedent to title, the provincial/federal governments in Canada will have to consult, and gain the consent of the respective First Nation(s) when development projects/timber harvesting concern unceded land, RBC analyst Paul Quinn told clients.
He noted that B.C. has accounted for roughly 24% of North American lumber production during the past 10 years.
If the Supreme Court ruling leads to delays and limitations in harvesting sawlogs in B.C., Mr. Quinn expects a tighter lumber market and higher prices.