Industry News

The Future of Cedar in an Evolving Market

Given the unsettled nature of the market, what can 2018 and beyond look like for real cedar products?

Most would agree there are few industries with as many unpredictable variables as those found in the softwood lumber business. In fact, the last two years can be described as tumultuous, at the least. The year 2016 saw the end of the Softwood Lumber Agreement. With pricing uncertainty on the horizon and a strong U.S. economy and lumber prices, shipments to the U.S. soared.

However, as if to underline just how erratic the market can be, heavy snowfall at the start of 2017 followed by a severe fire season limited production and market supply. Demand increased (housing starts were up), but new duties resulted in record prices which prompted some consumers to start looking at alternative products. As competitive composite materials continued to gain more traction, this posed an additional threat.

Furthermore, the role between distributor and retailer saw significant change and will continue to do so. Given the unsettled nature of the market, what can 2018 and beyond look like for real cedar products?

In the search for insight, the Western Red Cedar Lumber Association worked with Home Innovation Research Labs (HIRL, formerly National Association of Home Builders) and MSC Marketing Solutions Consulting to quantify the U.S. residential WRC market and identify growth opportunities.

The HIRL research estimates that over 1.066 billion bd. ft. of western red cedar was consumed in the U.S. in 2016 in selected residential applications, in both new construction and the repair and remodeling sector, with the majority of this volume used in the latter.

Current indications are for continued economic and housing start growth, with a stable and sustainable supply of WRC to meet demand.

What’s driving usage? The HIRL study determined the R&R sector accounted for 88% of total volume (interior products and non-res construction were excluded from the study), and new construction consumed 12%, although as noted growing housing starts may increase this.

The areas of highest WRC usage were the Pacific Northwest, including Northern and Southern California and Hawaii; West South Central (Texas, Arkansas, Oklahoma and Louisiana); East North Central; and the South Atlantic. The West South Central and East North Central areas saw the highest growth rate, while the Pacific remains the area with the largest consumption.

Siding is identified as an important WRC application, as is decking, outdoor structures and living areas, and fencing. The study noted that application usage varies by region, which is very useful information from both a distribution and marketing view.

For the consumer perspective, the WRCLA engaged consumer researcher Strategic Growth Insights to determine and track WRC awareness and attitudes among homeowners, builders, and architects, particularly in comparison to those of competitive composite products. Baseline data was first collected in 2014, comparative data in 2017, and additional research was done in January and February of this year and will be available shortly.

The SGI study found that western red cedar scored highly and outperformed composites on emotional drivers such beauty of the product, natural appearance, pride in my home, and, character, as well as more pragmatic values like, adds value to my home. Composites have a perceived advantage over WRC in ease of maintenance and cost. Awareness has increased overall since the 2014 baseline in regions where real cedar is actively conducting promotions, and competitors have gained ground in regions where no promotional activity was done.

The two studies revealed detailed data on which benefits and aspects of WRC are most compelling to consumers. The data is segmented by area, usage by region, usage by application and price sensitivity (a model was created from the data to predict the point at which an increase in WRC cost would trigger a loss in market share).

The data allows the WRCLA to tailor more targeted and effective messaging for both a consumer and professional audience and deliver it more accurately. It also sheds light on what opportunities exist or can be created by geographic region and application, and the association can engage their manufacturer and distribution network to capitalize on those opportunities.

While there are numerous factors that will effect change in the softwood market, the rise in cost to the consumer due to new duties is arguably the most significant. Through continued consumer and market research, the WRCLA is able to continue to build awareness for WRC and position it as a premium product. The data also allows a market approach that focuses on key strategic segments and higher volume consumption regions to mitigate threats and maintain market share during this disruptive period.

With a consistent and sustainable supply, and the HIRL Consumer Practices Survey showing a positive trend in market share for WRC products, cedar appears to be adapting to an evolving market fairly well.

Western Red Cedar Lumber Association

Established in 1954, the Western Red Cedar Lumber Association is the voice of the cedar industry and has members in over 131 locations throughout North America. Find more info at

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